Selling house to brother

[netrish01]

we have a house in north carolina, trying to sell for 2.5 years. brother wants to buy, doesn't have down payment, has loan company that will loan 80% = $60,000 but require down $15,000 on note. he wants me to send a receipt stating he paid me the $15,000 so he can get the house. we will pay tax on the $15,000 just as if we really got the money out of the proceeds from the house. what i want to know is, are we going to get in trouble for doing this. i don't want to be guilty of fraud but i am desperate to get rid of this house because it is costing us so much to have that house and live in nebraska that if we don't get rid of it soon we will have to file bankruptcy because we can't afford to make the payments anymore and my husband is out of work right now.

 

[HomeGuru]

Post on the Tax Law board.

 

[dman6666]

Don't know about the legalities of it, but, most mortgage companies will look for bank records showing the transfer of the money from the buyers account(s). They'll quite probably look for $15,000 changing hands. If you say it's cash I'm sure it will raise an eyebrow!

So, Even if it's legal, it may not work with his lendor.

If not, he might qualify for / consider a higher percentage loan via va/FHA.

If you are having trouble making payments, you may want to talk to your bank to see if they can offer any assistance. They may be willing to refinance or defer payments to avoid bankruptcy.

Good Luck.