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Property "ownership" without actually "owning"

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pdeiuliis

Junior Member
What is the name of your state (only U.S. law)? Maine

My in-laws own a 2 family rental property. They dont actually own it, but their name is on the mortgage. They do not have the financial ability or willingness to properly manage the property. My wife, brother-in-law, and myself has assumed all responsibility for the property. We handle all maintenance, management, and expenses for the property. In exchange, we are able to make all decisions for the property and are entitled to all profits from its sale, or any positive monthly cash-flow.

Is there a way that we could draw up a legally binding contract with my in-laws that would protect our interests in this arrangement? I understand that we could purchase the property from them outright, but we would need to come up with a big fat down payment and get slapped with a much higher interest rate which would compromise the cash flow. We would be happy if we could simply leave things the way they are and draw up a contract with my in-laws that would hold up in court if needed.

Any suggestions??? Or should we just bite the bullet and purchase the property from them??
 


FlyingRon

Senior Member
Who "owns" the property (who is on the deed).
Is it the in-laws or the three kids?

This is far too involved to draft without a lawyer. The bigger issue is that it looks like you guys are in a position to really screw the in-laws with the current arrangement, both from a financial and a risk standpoint. Further you should seriously consider the tax implications of all you are doing.
 

HomeGuru

Senior Member
What is the name of your state (only U.S. law)? Maine

My in-laws own a 2 family rental property. They dont actually own it, but their name is on the mortgage. They do not have the financial ability or willingness to properly manage the property. My wife, brother-in-law, and myself has assumed all responsibility for the property. We handle all maintenance, management, and expenses for the property. In exchange, we are able to make all decisions for the property and are entitled to all profits from its sale, or any positive monthly cash-flow.

Is there a way that we could draw up a legally binding contract with my in-laws that would protect our interests in this arrangement? I understand that we could purchase the property from them outright, but we would need to come up with a big fat down payment and get slapped with a much higher interest rate which would compromise the cash flow. We would be happy if we could simply leave things the way they are and draw up a contract with my in-laws that would hold up in court if needed.

Any suggestions??? Or should we just bite the bullet and purchase the property from them??
**A: yes there is a way. First step get legal counsel.
 

tranquility

Senior Member
I agree with an attorney. Starting with the title and carrying on with "They dont actually own it, but their name is on the mortgage. ", I shake my head thinking this is already FUBAR.
 

FlyingRon

Senior Member
I agree with an attorney. Starting with the title and carrying on with "They dont actually own it, but their name is on the mortgage. ", I shake my head thinking this is already FUBAR.
I actually think they do own it, but the kids want to treat it like it was there's.
 

pdeiuliis

Junior Member
free advice my a$$...what a joke

well, this turned out to be a huge waste of time... thanks alot for nothing guys... I post an honest question about a serious family situation, hoping for some decent feedback, and instead I get a bunch of snide remarks about how idiotic my question was and insinuations that we are somehow trying to fleece my in-laws..... I thought the site was called "freeadvice." Some actual advice might have come in handy...

For the person who posted simply "there is a way. First step legal counsel," thank you. While it wasn't earth shattering news, that was the only worthwhile piece of advice I got from this useless site all day************** thanks for at least taking my question seriously.
 

nextwife

Senior Member
well, this turned out to be a huge waste of time... thanks alot for nothing guys... I post an honest question about a serious family situation, hoping for some decent feedback, and instead I get a bunch of snide remarks about how idiotic my question was and insinuations that we are somehow trying to fleece my in-laws..... I thought the site was called "freeadvice." Some actual advice might have come in handy...

For the person who posted simply "there is a way. First step legal counsel," thank you. While it wasn't earth shattering news, that was the only worthwhile piece of advice I got from this useless site all day************** thanks for at least taking my question seriously.
You have no clue WHO is on title, based on what YOU posted. Being on the mortgage gives them NO rights to convey the property!

How can we advise you about "buying" from your in laws who are only on the mortgage? Come back once you know who the legal OWNER happens to be and what they are willing to do.
 

HomeGuru

Senior Member
well, this turned out to be a huge waste of time... thanks alot for nothing guys... I post an honest question about a serious family situation, hoping for some decent feedback, and instead I get a bunch of snide remarks about how idiotic my question was and insinuations that we are somehow trying to fleece my in-laws..... I thought the site was called "freeadvice." Some actual advice might have come in handy...

For the person who posted simply "there is a way. First step legal counsel," thank you. While it wasn't earth shattering news, that was the only worthwhile piece of advice I got from this useless site all day************** thanks for at least taking my question seriously.
**A: you got that post from me, an attorney that specializes in real estate and construction law. Your post was very confusing and even if it were not, the issues are too complex for a legal website such as this one. That's why I advised you to seek legal counsel. I am sorry you felt that you did not receive the proper treatment. Please contact the website administrator and demand a full refund. Thank you.
 

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