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Also - if your MIL were to go on medicaid in the future (is she on Medicare now?) - that $100,000 she gifted you would be a hindrance. Medicaid looks back 5 years and will try to reclaim that money.
However, if she goes on medicaid and is in the house with you (and on the title) - the house would be protected as Medicaid does NOT go after a primary residence (nor a vehicle).
You may also have the issues with a gift tax - as other posters have pointed out.
Well, we could get around the gift tax idea by suggesting she sign a quit claim deed on her house and then gifting her the maximum non-taxable amount each year until we pay her back the difference. But some of you have voiced your opinion that we are pushing our luck, morally, as it is, even though we would never abscond with her money, and I do see your point. It's only fair to look at it from my MIL's perspective, too.
I like Chet's idea of a contract whereby we borrow the money from her indefinitely under the condition that she lives with us rent free for an indefinite length of time. If we go our separate ways, the contract says she gets her money back. That way the house is in our name, but we "owe" her $100k.
Of course, this means going through an expensive lawyer, but that might be the right way to go.
For $100,000, couldn't see live "above-grade".....what happens when she can no longer negotiate stairs. And you say "cook meals "sometimes".....what do you do the rest of the time.......this whole thing is creepy.
Yes, we'll do the cash contract after she sells her house and has the $$.
My MIL is not crippled. She probably won't be making 4 course meals, but she can easily make a sandwich, put in a tv dinner into the oven, make hamburger helper, etc. So it's not like if we don't make her something, she doesn't eat. What I meant was if we are cooking a big family meal, we'll make enough for her, if she wants it. Also, we're going to get a house with a walkout basement and plenty of lighting. We don't want her to feel like she's living in a dungeon which alot of basements feel like. But we do want our own space apart from her.
Yes, we'll do the cash contract after she sells her house and has the $$.
My MIL is not crippled. She probably won't be making 4 course meals, but she can easily make a sandwich, put in a tv dinner into the oven, make hamburger helper, etc. So it's not like if we don't make her something, she doesn't eat. What I meant was if we are cooking a big family meal, we'll make enough for her, if she wants it. Also, we're going to get a house with a walkout basement and plenty of lighting. We don't want her to feel like she's living in a dungeon which alot of basements feel like. But we do want our own space apart from her.
--" But we do want our own space apart from her "
Then put down more money than $1 for every $10 she invests.
Sounds like you get the $100,000 and you call the shots.
Your wife must be the only kid in the family or red flags would be going up from the other siblings !
Then put down more money than $1 for every $10 she invests.
Sounds like you get the $100,000 and you call the shots.
Your wife must be the only kid in the family or red flags would be going up from the other siblings !
My wife has a brother who would probably live with her just before he lived under a bridge.
Keep in mind this is her idea.
I understand that you don't like it that she invests alot of money and ends up in the basement. I get the logic. If it makes you feel better, she could keep all of the proceeds of her house. We buy a lesser house at the absolute top of what we would qualify for in a mortgage in order to find a place that's marginally ok for her. We charge her rent so we can make the mortgage payments. If we sell, she gets nothing and loses everything she has put in for rent. Or we could go with my plan. She pays no rent or utilities at all. If we sell, she gets her entire $100K back plus a portion of any appreciation.
I want to own the house ourselves without our MIL because (among other things) it protects the house from being sold if something like a major health issue happens with MIL that wipes her out.
Your mom is entitled to medicare benefits. Healthcare issues are not going to cause her to lose her home.
On the other hand, you could lose your job and be unable to pay your mortgage. You could lose the home and your mom has nothing.
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