My son is buying single family residential home from his sister. The home is in a subdivision located in Michigan where typically Title Companies close the sale. The following are the conditions.
- home with mortgage paid off. Bank has issued letter that they no longer hold interest in home and mortgage lien has been released
- purchase is a cash sale at market value based on very similar homes sold in last 3 months across street and next door.
- for sale by owner with no real estate companies involved
- inspection has been waived. Son is very aware of 7 years of his sisters ownership issues in last 4 year new roof, HVAC, and water heater were replaced. His father in law is a home contractor and has completed a satisfactory home inspection.
- son will pay cash for home. No new mortgage involved
- written purchase agreement is being drafted to meet state requirements
- property taxes will be prorated
At closing their understanding is the following must be completed by the siblings
1) Pay state and county Transfer Tax ($8.60 per $1000 of purchase price)
2) Record deed transfer at Township and submit form for new owner as resident owner for future property tax valuation. (Sign the
quitclaim deed in presence of a notary then file it with county register of deeds Office in county of sale). Review of deed has been
completed with no issues. Daughter had mortgage so she had to have Warranty Deed transfer from previous owner.
3). Wire transfer or check for proceeds of sale of from brother to sister at close.
4). Daughter has purchased new home this/same year so should home sale proceeds should not be a taxable event. I am not if she
needs to notify the IRS.
5). Notify HOA that new owner is in place as of close date
Asking for feedback and suggestions from the group if not using a title company is reasonable. The potential benefit for them is not having to pay the Title Company an estimated $1700 for their services.
Thanks
Understudy
- home with mortgage paid off. Bank has issued letter that they no longer hold interest in home and mortgage lien has been released
- purchase is a cash sale at market value based on very similar homes sold in last 3 months across street and next door.
- for sale by owner with no real estate companies involved
- inspection has been waived. Son is very aware of 7 years of his sisters ownership issues in last 4 year new roof, HVAC, and water heater were replaced. His father in law is a home contractor and has completed a satisfactory home inspection.
- son will pay cash for home. No new mortgage involved
- written purchase agreement is being drafted to meet state requirements
- property taxes will be prorated
At closing their understanding is the following must be completed by the siblings
1) Pay state and county Transfer Tax ($8.60 per $1000 of purchase price)
2) Record deed transfer at Township and submit form for new owner as resident owner for future property tax valuation. (Sign the
quitclaim deed in presence of a notary then file it with county register of deeds Office in county of sale). Review of deed has been
completed with no issues. Daughter had mortgage so she had to have Warranty Deed transfer from previous owner.
3). Wire transfer or check for proceeds of sale of from brother to sister at close.
4). Daughter has purchased new home this/same year so should home sale proceeds should not be a taxable event. I am not if she
needs to notify the IRS.
5). Notify HOA that new owner is in place as of close date
Asking for feedback and suggestions from the group if not using a title company is reasonable. The potential benefit for them is not having to pay the Title Company an estimated $1700 for their services.
Thanks
Understudy
Statistics: Posted by Understudy — Sun Sep 15, 2024 3:47 pm — Replies 3 — Views 183