2007-10-19 04:37:21 · 19 answers · asked by lulu 5 in Business & Finance ➔ Renting & Real Estate
there is still a mortgage on the house. i was told by a realtor that i could not do it.
2007-10-19 04:41:23 · update #1
state of TEXAS
2007-10-19 04:46:01 · update #2
The Realtor said this because you have a loan on the home. As long as you sell it to them for enough to pay off the current mortgage off then you can sell it for whateverprice that you want to. In all loans there is an acceleration clause that states if you sale the home you have to pay your lender off all the money that is owed on the home. So feel free to give your family a great deal but make sure the price is enough to pay off the current mortgage. Hope I helped.
2007-10-19 04:53:08 · answer #1 · answered by young2bballin 2 · 0⤊ 1⤋
You can sell a house for whatever a buyer will pay for it. Certainly you can sell it to a family member below its market value, but the mortgage has to be paid.
For example, if you had a house worth $100,000 and you still owed $90,000 on the mortgage, you could sell it for $50,000 to your brother, but you would have to pay off the mortgage first. Normally, when a person sells a house that still has a mortgage on it, the bank gets that amount when the property is transferred. So, unless you have the money in the bank to pay off the mortgage, you can't sell it for less that the mortgage amount.
2007-10-19 04:52:18 · answer #2 · answered by iraqisax 6 · 0⤊ 0⤋
Any time a house is sold, the existing mortgage has to be paid off (unless you stay as a co-owner.)
You can sell for whatever amount you want, as long as you pay off your mortgage.
Lets say you have a house valued at $200,000. You still have a balance (still owe the bank) $100,000 on your mortgage.
You sell this house to your family member for $120,000 which is way below the value, but it's fine because it's enough to cover your mortgage. But if you want to sell for $50,000 then it's also fine, but you'll have to add another $50,000 out of your pocket to pay off the mortgage.
As long as the mortgage is paid off (no matter which way) you can sell for any price you want.
As for property taxes, your family member will pay them according to what the assessors office thinks the value is, not according to the price you gave to your relative.
2007-10-19 07:17:24 · answer #3 · answered by REALTOR 3 · 0⤊ 0⤋
Perhaps it varies from state to state, but where I am, it is completely legal. I have seen many transactions where a house was sold for a dollar.
What I don't know is, if the difference between the selling price and the actual fair value becomes a gift, thus taxable as a gift.
You will need to consult with a realestate attorney for an exact answer.
2007-10-19 04:42:06 · answer #4 · answered by tkquestion 7 · 0⤊ 1⤋
That's not true at all. What you can't do is sell it way below value, and report it as a loss on your income taxes.
The difference in the real value and the sale value might also be considered as a gift for tax purposes. So long as you document, declare, and pay for everything properly, you shouldn't have any trouble, though.
2007-10-19 04:41:19 · answer #5 · answered by El Jefe 7 · 0⤊ 1⤋
Sounds like you might be making a gift to your relative in the amount of the discount beyond fair-market value. Gift taxes and generation skipping tax may apply. You need an accountant.
2007-10-19 04:45:25 · answer #6 · answered by aaron p 5 · 0⤊ 0⤋
There is nothing correct about that statement.
As the sole owner of a property, you essentially determine it's value, and you can sell it for any amount of money you wish.
There are no restrictions on the sale of personal property, providing that it is of course legal to buy or sell, lol.
2007-10-19 04:42:00 · answer #7 · answered by diz_x3 1 · 0⤊ 1⤋
Of course you could do this if you have a 0 balance. All monies have to be transferred, from your bank to their bank. The county has their paperwork on record also. You can't buy something for 100.000 k. only pay $ 10.00, sell it to someone for $20.000.00. Does this make sense? Good luck!
2007-10-19 04:48:52 · answer #8 · answered by ? 6 · 0⤊ 0⤋
the answer is: not true, if you have the right to sell without the permission of anyone else claiming a title interest such as the mortgage company. The consenquences, on the other hand, are more relative to taxes.
Additional Details:
The realtor is correct, without the permission of the mortgage holder such as in a short sale, you can not sell the property unless you retire the entire amount owed on the note.
2007-10-19 04:41:51 · answer #9 · answered by newmexicorealestateforms 6 · 1⤊ 5⤋
You can sell your house for a $0.01 to ANYONE as long as you have the money to cover any liens and to pay any existing mortgages.
2007-10-19 04:40:10 · answer #10 · answered by Anonymous · 4⤊ 0⤋