I am considering purchasing a family member's home from them while they remain in the home until they eventually move out (to a facility or upon death). I am looking to increase my rental portfolio in an area where investment deals seem scarce, and this family member is looking for more cash flow in her later years. I would be paying off the mortgage and giving her cash for the rest of the price.
I believe this is a good idea from a personal standpoint. I trust the family member implicitly and vice-versa, she would keep the home immaculate and do small improvements as she's done over the years. She still works in her mid-70s and struggles to pay for anything but the basics. She plans to leave her home to be sold after her death with the proceeds split among 6 family members. It is hard to watch as she is living a very strained lifestyle and these others (including myself) will eventually profit while she struggles monthly. I would love to help her enjoy the money she has put into the house and also remain in the place she has made home. She has expressed interest in this idea as well. Financially, I'm not sure if this is a good idea. I would be tying up about 16% of my net worth in an investment that isn't producing any cash flow, and hopefully won't for many years if she remains healthy. But I have a healthy net worth and it will eventually grow a lot more due to other windfalls down the road.
My father, who gave me lots of financial advice, recently passed away, so I'm wondering who the correct person is to discuss - 1) if this is a good idea for my personal situation and 2) if we go ahead with it, how to structure the deal and ensure it's all done legally/fairly for both parties (attorney?).
I believe this is a good idea from a personal standpoint. I trust the family member implicitly and vice-versa, she would keep the home immaculate and do small improvements as she's done over the years. She still works in her mid-70s and struggles to pay for anything but the basics. She plans to leave her home to be sold after her death with the proceeds split among 6 family members. It is hard to watch as she is living a very strained lifestyle and these others (including myself) will eventually profit while she struggles monthly. I would love to help her enjoy the money she has put into the house and also remain in the place she has made home. She has expressed interest in this idea as well. Financially, I'm not sure if this is a good idea. I would be tying up about 16% of my net worth in an investment that isn't producing any cash flow, and hopefully won't for many years if she remains healthy. But I have a healthy net worth and it will eventually grow a lot more due to other windfalls down the road.
My father, who gave me lots of financial advice, recently passed away, so I'm wondering who the correct person is to discuss - 1) if this is a good idea for my personal situation and 2) if we go ahead with it, how to structure the deal and ensure it's all done legally/fairly for both parties (attorney?).
Statistics: Posted by snowyday24 — Mon Apr 08, 2024 1:17 pm — Replies 3 — Views 128