My mother passed away and my brother and I are on the deed to her house. The house is in MA, I am in CA, and my brother is in Asia. My husband and I are handling most details of the sale of the house, along with our attorney. We quickly found a buyer, but the home inspector found multiple problems and the buyer backed out. Now we are trying to decide: 1. Sell the house as-it for a very low price. 2. Make some of the repairs, the most important repairs that are deemed unsafe if left undone. 3. Bring the house up to standard and sell for a higher price.
Several issues: -My brother has dementia and just dealing with his wife is difficult as she is stressed out. I know they need the money since she had to quit her job to take care of him so they do have incentive to do what they need to do to get this sale done. However, she has told us that they will not contribute money to help with the upgrades. She is of the mind to sell as-is because anyone who buys it “will gut it anyway”. -My husband called a realtor we have known for decades to ask his advice. The realtor is of the mind that buyers want a perfect house they can move into immediately. So now my husband is convinced that this is the way to go. However, this realtor is accustomed to dealing in $1 Million + properties. My Mom’s house is in a small rural town in which most of the homes are very old and not fancy. At best after upgrades, her home could be worth $425,000. There are few homes for sale and probably not many buyers.-We are already $30,000 into what we had to contribute to keep Mom afloat in her last 2 years before we got her on Medicaid so I feel it would be a bad deal to spend even more money, not knowing when or if we can recoup our investment. Even doing the most important upgrades for safety reasons (i.e. electrical) will cost $10,000 or more, I imagine. -If the house does not sell for many months or a year or more we will still have to pay taxes, maintenance, heating oil, etc which we have been doing for a year. Does anyone have experience dealing with a house you inherited but it seems it may cost more time and money and headaches and you just want to be done with it ASAP? (No, I am not sentimental about this house.)
This is too much to handle from afar. Along with the cost of the repairs, you may be paying for the attorney for a longer period of time so that will cut into the profits.
Since the house is in Massachusetts, you'll need a property manager to check it regularly, especially in winter, to prevent frozen pipes, leaking in the basement, flooding, electrical outages, etc. Snow removal can be important to prevent leaking and damage to the driveway and the roof.
I know a woman in Massachusetts who inherited her childhood home. She planned to move into it after retirement. She checked it on weekends. She arrived one weekend to find a pipe on the upper level had burst, and the house was a combination of flooded and iced. It was beyond repair. I don't know what she eventually did with it. I know of another childhood family home that was vacant and a drug addict vagrant broke in and it caught fire from his use of drugs in the basement.
Regarding the lien, how long ago was the property deeded to you? If it was through inheritance and was your mother's while she was alive, then the lien would have been placed on the home then.
Sometimes in rural areas people buy rundown homes primarily for the land, especially if zoning isn't strict.
It sounds like your family has been through a lot. Keep it simple and just unload this part of your mother's estate as simply as possible. I hope you can get closure and peace of mind soon.
Cut your losses and do not sink any more time or money on speculation that you’ll make more money.
Find a local realtor and sell it as is as quickly as possible, pay off the lien and move on with your life.
The lien isn’t there like a secured debt (HELOC, mortgage), that has been recorded and gets cleanly paid off at the Act of Sale. It’s placement is unsecured debt and more subterranean and shows up when the title company does the search once the deal is in motion and after the earnest money being held. It’s a cloud on the title and has to go thru a verification process. Which can be glacial in time, plus add probate process time to selling an asset of an Estate under whichever type of administration Executor is functioning under.
Could take months & months & months that’s not going to work for most buyers as their credit worthiness from their lender is for 30-60 days. If it’s FHA lending, their appraisal max is 180 days and they expect the close to be 30-60 days. Realistically imo the buyer would be an investor with the ability to let their earnest $ be tied up for maybe a year, with no effect on their bottom line. Flippers can’t do this as they need to tart it up and sell quickly. Buyers who need lending can’t either. So houses like this, sit.
I’m of the firm belief that over 50% of the seemingly abandoned older SFH are this way due to the Medicaid lien. The heirs (or better yet their spouses) have zero interest in spending their $ & time to do repairs, pay property taxes, keep utilities on, etc on a property that they themselves will get little to no $ back from. Fam has zero interest in dealing with probate & its legal process. So the house sits vacant till finally sold through its County’s tax sale property redemption process years from now.
Advertise and tell the realtor house is sold as is.
If in fact that house is 100% actually only in you & your brothers name….. so that the annual tax bill is/was addressed to you and the title recorded at the courthouse 100% reflects this with you & bro names only…. then there should not be a home of your moms that has become an Asset of her Estate subject to the required Medicaid attempt of Estate Recovery.
I’m going to guess that either: 1. mom actually did a Life Estate Deed so that you & bro were remainderman for the LE. If this is it, then it probably is that LE for how MA does MERP is still consider an asset of her estate. LE have to have the remainderman % sussed out based on actuarial tables and there’s specific IRS tax filing that have to happen and some other involved details. So LSS you have to get either a Tax Attorney or a Real Estate attorney - preferably one that practices in the Co. where the house is - to deal with determining the % ownership and establishing it legally so that only moms death % is subject to MeRP. None of this is a DIY. Fwiw lots of folks do LE and think this bypasses MERP, only to find unhappiness as their State does place recovery on the non-remainderman % ownership.
or
2. the legal done was defective. So she / her Estate owns it.
MERP will have a system for how it is done in MA as State laws matter for how property rights and probate are done. My experience is that 3-6 months from her death, whomever was her POA or was the family member who did her LTC Medicaid application, should have gotten a NOI from MERP or the State of MA outside contractor for MERP. NOI = Notice of Intent to file a lien or a claim against the deceased Estate. If it isn’t responded to then the State assumes the lien/claim is valid.
NOI will have the amount supposedly owed and a questionnaire as to the status of the Estate and the assets as of the Day of Death. It is also where you can file what’s exemptions or exclusions you feel apply for Estate Recovery.
Personally I would not spend any more unnecessary $ until you know for sure what is or isn’t placed by the State on her property. I’d get a Real Estate atty for this.
On selling older homes with decades of delayed maintenance, I’d look to see what really truly comperable homes in the same condition sold for in her area the past few months. Even if you have to go to an adjacent county. And if it took 6 months or longer DOM (days on market) to finally sell; and what the difference was in price from when it was initially placed vs finally sold. My feeling based on the way you described it…. is the house may be at the point where even if you spent some $$$ to refresh the house, did a bit of landscaping, it’s still an old house that is vacant in an area that is not sought after. Buyers are going to want serious concessions $$$ from the asking price. If it’s not up to current code, that leaves out any FHA or VA buyers. If the comps sold actually have been close to the land value rather than the land + house value, to me, it imho would be a waste of time AND money to do repairs. The property tax bill should have the land and the house value as 2 separate items.
When my Dad moved to senior living, he had me sell his house. My parents did no remodeling the 30 yrs they were there, oh an occasional new appliance and a new roof. I had the house appraised by a licensed Appraiser, and went along with his recommended value. The house sold quickly to a flipper.
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