My husband and I bought a house for my parents when they were having their home repossessed. The agreement was that we would get them into the house and they would be responsible for the house payment, maintenance, utilities and upkeep. My mother died a year later.
Since doing this, we have found out that my dad has nearly depleted all of his savings. I wouldn't be concerned if it were to take a trip or something, but it has been used to keep up with living expenses. Unfortunately, the housing market fell out right after we bought the house, so we owe more on it than it is worth, so refinancing it is not possible. My dad has not been able to pay for the maintenance and upkeep, so my husband and I have been left with this added expense. This has been putting a pinch on us.
We reviewed my dad's (who is 84) financial situation and he only has $170 for food and incidentals after paying the house payment and utilities. This was for an average month. He is spending about $500 more than his income each month. I do have a 40 something brother who lives with him, but he refuses to contribute anything but an occasional pizza or something. We have tried everything to get him to contribute. He has a full time job. At least we know dad is not alone and someone is in and out every 24 hours.
I went to my siblings and told them I thought we needed to move dad to a more affordable place. We also offered any of them to buy the house, at todays market value and interest rate. This should reduce the payment. We are looking at losing $60,000 to $80,000 on this deal. So far nobody is willing to do this. Their solution is for everyone to take on a bill and contribute to a fund to help with repairs. We aren't too comfortable with this as we have asked them to do this, in the past, and nobody would do so. (Their theory was that it was our house and we should take care of it.) Our fear is that they will do it for a couple of months and then stop.
My husband and I cannot afford the house payment and utilities. The maintenance is also draining our savings way down. We have about enough left to pay for all of the moving expenses, move in expenses, make any necessary repairs for selling and pay for a few months of expenses while the house is on the market.
In order to sell the house, we will be having to take money to the table. We can borrow from my husband's parents, to do so, but we need to do so soon, and get it returned, as his dad is in need of being moved to an assisted care facility and they will need the money for that.
Are we being unreasonable to think that moving my dad to a cheaper place would be best? I know he doesn't like the idea and he is 84. I don't like the idea of moving, either, as I am the one who will have to do all of the labor. My dad has a lot of things and is a bit of a pack rat. I am starting to get threatening messages from my siblings. I just don't trust that they will follow through with their contributing and then we will be a year later and dad will be older, he will have no money left, we won't have any money left and we will have lost our resource for a loan to get us out of the house. Please, any solutions and suggestions are welcomed.
Your sibs? Sorry. The house is none of their business.
I just don't know how to get them to back off and how I am to get my dad to look for new place, when he refuses. I agree, my husband and I should not sign a lease for him. He and the brother should put their names on it. But how do you get them to even look for a new place? Maybe we should just let the bank have the house back and let the bank tell them to get out.
Thanks for everyone's help. I really appreciate the input. P.S. Igloo572 - love the witch comments. I was born on Halloween and have always loved the Wizard of Oz. In fact I have always told everyone that I want Ding Dong the Witch is Dead played at my funeral ! :)
- first, stop thinking of the house as a home but as a piece of PROPERTY. This helps in getting rid of the emotional baggage with all this.
- second, try not to borrow from your DH's family for this. Who knows you may need to ask them for something a couple of years from now.
- third, Dad has shown that he is totally irresponsible in the past with having a house repo'd. Now I'm assuming that this was a mobile home rather than a traditional home which would go via a foreclosure. He doesn't get what ownership entails and never has and never will. His staying at the property will only lessen the value of this investment. He has got to go. Same for the brother. You are enabling a situation that will not turn around for the better and could cause long term financial issues for you and your patience of a saint DH.
I'd give him 60 days and then he's out as the property is going to be sold. Tell him in clear terms and also in writing. This is between Dad and you & your DH as owners of the property. If Dad takes it up with your siblings, then that is his issue. Rather than put him on the street, I'd take whatever he is supposed to pay for rent & against the mortgage for 2 months and use it to pay for 1 mo rental & 1 mo deposit and pay to move him in and therefore out of the property. Or if you are feeling generous, you pay for the deposit and 1 mo rent and therefore he has extra money to deal with month 3 & 4. Make copies of the checks and all documents as you know there will be blowback. Find someplace simple, accessible and inexpensive but do NOT sign off as the financially responsible party.Contact your Agency on Aging to see what might be available. He might do well at a board & care style of home. Change the locks on all at the property.
- fourth - find a couple of Realtors to evaluate the situation as far as comps and days on market and what you need to do (and spend even more $$ on) to make it sellable. Personally, and this is tough, if you are negative equity on the property at 30% and the comps aren't looking good and days on market is in months rather than days, I'd just walk away from it and let it go into foreclosure.
I'm assuming the property is not in anyway companionized to the home that you & your DH have, so a foreclose doesn't matter to that mortgage. Now if it is then you are stuck with it. A short sale like Madge said could work but they tend to take forever so you have to constantly goose the mortgage holder to get paperwork through. Whatever the case, a good Realtor will help you keep your sanity.
- fifth - my guess is that your siblings are envious of you. You can't fight that if it is the situation as that is their emotional baggage.
Lastly, when dealing w/difficult family, I have found, that we (women) can either be the witch of the east or the witch of the west but we never ever can be Glinda the good witch no matter what. Just do what is best for you and your DH 1st.
I feel sorry for your father, however, he was not honest with you from the beginning about his financial situation. After all he was having a home repossessed. That should have been a red flag.
As they say, no good deed goes unpunished.
Your intentions were honorable but the result is a disaster for you. The bank only cares about who is on the mortgage. If this is totally your home, it will be up to you and your husband to get rid of the home or work out a plan with your siblings to divide up the money owed each month to keep you father in the home. Sad, situation.
If the siblings are not legally bound to the home and they are not likely to help with expenses each month, you have no option other than to get rid of the home. At this point you are looking at financial ruin if this continues, not to speak of mental anxiety.
In this market, I know of several situations that have turned sour for several families. In one the couple is looking at a short sale. This may be your better choice. Anyway you cut it, if you sell the house you will lose money at this point. And depending upon your siblings to pay for the upkeep and billing monthly is probably wishful thinking.
if I were you, I would look to salvage what you can and prepare for your future. Your father may have to look into other, cheaper options. But your heart was in the right place. Good luck to you
Any idea of what % negative equity in the house?
So how do we deal with him and the sibling who are uncooperative about moving him? They are telling him not to go and look for a place. I am sure they will tell him not to let any real estate agents in to look at the place. They are threatening legal action. This is getting really ugly. I don't understand why they want him to be humiliated by having to depend on others to support him, not to mention watching my husband and I lose everything. We knew we were getting in financial trouble, but had no idea my dad was having trouble until it was brought to our attention that he has nearly depleted his savings for living expenses. How do I get them to understand that depending on them is not an option for us and that the best thing is to move dad to a place he can afford?
Thanks
First, what is good for Dad and is within his means? He might want to stay where he is, but he can't afford it.
Sounds like he might qualify for subsidized senior housing. There is often a waiting list for those (at least here) but the sooner he applies the sooner his name would come up. You'd need a plan for bridging the gap. Could he continue where he is if you know there is an end in sight?
Is Dad at or likely to soon be at a point of needing help with activities of daily living? Would assisted living be suitable? Could he afford that?
It does not sound like Dad needs skilled nursing care, right?
After you come up with a housing option that Dad can afford, then do what you need to do to minimize the losses on the house you bought for Dad to live in (and which he cannot afford at this point). Maybe renting it out does make sense. If the broher who is living there wants to rent it at fair market value I would definitely get a contract the same as you would from any renters!
Remember that some day you and your husband will be old and no longer working. If fact, let us hope you live several decades beyond your retirement. Who/what is going to support you? No matter how much you love Dad it is not a good idea to delete your own savings on his behalf.
Good luck!