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Selling to Brother |
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I own the house that My mother and brother live in. It is time to sell to my brother. I hold a $50k mortgage, the house is appraised at $200k. I agreed to a purchase price with my brother of $150K. Can I do that and if so what do I need to look out for legally and taxes? Thanks |
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No reason why you can't sell to your brother for any amount you wish. I don't know what your capital gains tax would be because I don't know your cost basis for the house. I wonder about that mortgage--
when you say "I hold a $50,000 mortgage," do you mean you owe that much? If so, it's likely that the loan will have to be paid off when there's a change in ownership -- that your mortgage company won't let your brother take it over. And anyhow, if he needs to place a new mortgage in order to buy the place, his lender would insist the old loan be paid off.
Or do you mean your brother is giving you cash and you're going to lend him the last $50,000, taking and holding his mortgage?
In any case, as you are in New Jersey where lawyers are routinely used for transfers, a real estate lawyer is the person to give you specific answers and to handle the sale. |
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Edith
Originally published on August 24, 2007 |
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