Hi all
We’ve a good friend who lives nearby an AMAZING house overlooking the sea and is planning to go into a retirement home in approx 2/3 years. We’d love to buy it.
She’s told us she’d be interested in renting it to us for 1st 2 years of being in the retirement home as there would be tax benefits for her(?) After 2yrs she says we could buy the house in instalments.
We don’t want to take advantage of her, so my questions are:
1. How would we agree on a fair price for both of us (she’s 85 and probably little idea of what it’s worth)
2. What would be the best way to buy it in instalments and should we agree to rent it first for 2 years? If so, we’d need some sort of first right to buy guarantee.Also, I hate to say it but everything would have to be watertight just in case she passed away before we’d bought the whole thing.
Thanks!
I’d get legal advice, perhaps the three of you need to visit a solicitor to make sure the deal is fair for everyone involved.
Ha I am a solicitor [biggrin][biggrin]
Looks like I need to get in touch with one of my old mates!!!!
Hi
It sounds to me like you need a lease/option for 2 years which you exercise and rollover into an Instalment Sales Contract. So the paperwork is relatively simple, i.e. a standard residential lease for 2 years, a two year option on the property and the contract you attached to this lease/option will be an Instalment Sales Contract.
If you are in NSW give Tony Cordato a call. I’m sure the members here will be able to recommend an equally good vendor finance specialist solicitor if you are in another state.
Good luck.
Cheers, Paul
Paul & Karen Dobson
negative2positive
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Hello
I would get the house independently valued to ascertain a fair price. You didn’t mention whether she has family but this way at least no one will be able to claim that you took advantage of her on the price.
Also I would inquire if there is any agreement you can make to cover the years before she goes into the retirement home. If anything, G-d forbid, happens to her in that time period her heirs may just put it on the open market or even decide to live in it themselves.
Cheers
ElkaYes Elka I agree, the last thing we want to do is to take advatage of her – or have any of her relatives think that we are. And yes, I am concerned that her relatives could just come along and put it on the open market.
Thanks Paul – your suggestion makes absolute sense. I could prepare some of the docs myself, but it would make more sense to have someone totally independant so no concerns about them being biased towards us. Now I just have to find someone to do it – and arrange to have a cuppa with the neighbour to discuss it all!
3 Valuations and then run with the Average of all three Value wise would be my suggestion. That way it is a very fair way to go. I would also be using HER Choice of Lawyer to oversee the whole process and draw up the documents. This way she has chosen them and no-one can claim you took advantage. Naturally you would be wanting to use your own solicitor as well, which is fair enough, but if the documents are prepared under her instruction no-one can claim fould play…
Stuart Milne
Non-Conforming Specialist
READY Mortgages
http://www.readymortgages.com.au
[email protected]
Mob: 0404 056 055Many thanks Elkam and Paul – I’ve taken your suggestions on board and we are going to propose doing 3 valuations by independent registered valuers (paid half by us and half by her). We will then ask her to choose a solicitor to do the paperwork.
I’d do the honourable thing and talk to the lady’s eldest son…..face to face…..man to man. Having dealt with quite a few solicitors / barristers and QC’s in the past this is usually beyond their abilities.
Out of principle….if a wormy solicitor (can you tell I despise all lawyers) came up to me as the eldest brother, after the fact of my mother’s passing, and said all the paperwork had been drafted and signed and agreed to buy my mother’s estate without my or my other brother’s and sister’s knowledge or input, I’d be livid…regardless of how many barriers you’d put in place to try and convince me after the fact you were a concerned and caring citizen and my mother did everything of her own volition.
Paperwork, more paperwork and lots of excuse material and evidence gathering….without ever having the kahuna’s to talk face to face with the rightful beneficiaries of the old lady’s estate……that’s exactly what I’d expect from a solicitor. [grrr]
Your “behind the scene’s” manouvering and positioning very strongly reminds me of a French fable where some lawyer in his 60’s tried to swindle some old lady who was 92 out of her estate without her family knowing about it. He had legally arranged….water tight as you say…..with some form of guarantee….with the elderly woman (without the family of the old lady knowing) to fund her final years and in return he would have the right to acquire her estate.
He thought she’d live about 2 years tops and then the spoils would be his……well she lived to be 120 and the lawyer – long since passed away, had to keep paying for her upkeep for the next 28 years out of his estate…..it was marvellous to see how the one supposedly screwing the innocent got royally done over…..marvellous effort from the old lady I thought.
Disgraceful !!!! You have confirmed my opinion of how a solicitor thinks. I want no further part of it….[angry2]
Hang on hang on Dazzling. Please don’t tarr all solicitors with the same brush! Clearly you’ve had some bad dealings with solicitors in the past and I’m sorry that this is the case, but please be aware that we’re not all bad.
I do resent being referred to as a “wormy solicitor”. We have never met and you know very little about me. You have also jumped to conclusions. I’m a trade mark lawyer at a small local firm. I’m a good upstanding member of the community, always try to do the right thing by others and I AM a “concerned and caring citizen” – and my many friends (who are not lawyers) will vouch for this.
We absolutely definitely have no intention whatsoever of doing anything that is unfair in any way and have no intention of “swindling” or “screwing” her or anyone else.
This is why I have sought everyone’s advice as to fairest way to do things.
Actually she ony had one son and he is dead. She has a daughter with whom she doesn’t speak to. I have already spoken to her grandsons about the matter (she brought the subject up first) and they have said that we need to sort things out with her as she is a very intelligent, clued up lady.
We’ve done nothing “behind the scenes” as you claim. We have spoken regularly about everything. In fact, my husband and her were discussing the matter YESTERDAY regarding the suggestions made on this forum, as she is keen to sort things out so that she can make plans for the future. It was her who brought the subject up initially and it is almost always her who asks us what thoughts we have had and how we should go about doing things.
We just want to do things in the fairest way.
Dazzling, I’d be interested to hear offline about your bad experiences with lawyers – if they are that bad then maybe some of them should be reported to the Law Institute?
Originally posted by Housemender:We just want to do things in the fairest way.
May I just ask why then are you, in your own words, “concerned that her relatives could just come along and put it on the open market.”
I can see how somebody reading that could get the impression that you are keen to do a a fair deal, but not prepared to give somebody else the chance of doing an ‘even fairer deal’. As in paying more for the property.Cheers, F.[cowboy2]
Fair point Foundation, I can see where you’re coming from.
My concern would be that we move into her house, which she wants to rent to us for 2 years. If, god forbid, anything happened to her during that time (but I’m sure it wouldn’t as she’s pretty healthy) then we would prefer to have everything in place as to what happens next – WITH the consent of her AND her relatives, rather than then have to deal with valuations, the house being put on the market etc at that difficult time.
This is NOT just what we want – it is what she wants too – ie she wants things sorted out in advance too – she has told us many, many times. Her concern is that, to use her words she “gets carted off to a home after having a fall or something” and it’s left to her family to sort things out.
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