Elderly in-laws refuse to sell house that needs $200k of work, are out of money, can’t get loan

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:would they sell you half the house for less than market value so you can fix it up and allow them to live there until they pass? With the agreement that you inherit the house entirely at that time?

The bigger issue is we don’t want the house or anything to do with it. We don’t even own our own house yet and we don’t want the liability of theirs, even if it may be “deal” at some point. Just not an option.

I don't understand how it is a liability? And if you don't own a house yet.... but you are able to get one for half off, that's a good deal. As an investment/flip. You don't have to live there.

But you’re tied up in family drama. You think her dh is gonna just sell it?
I would also stay far away from any ownership in this home.

[Anonymous]

Have DH begin some open dialogue on end of life issues; funeral arrangements, for instance. It’s all uncomfortable, so maybe DH approaches all in a detached, professional way. Hey Dad, do you guys have LT care insurance? Here’s what we’re looking into now as you get people…

Baby steps. And word of warning: be prepared for DH to be rebuffed or ignored. He needs to keep asking. You, DW, have to stay out of the conversation. Provide support and listen but don’t be physically present lest you be accused of Gandhi g up in ILs. Stay neutral!

Also, all fine and dandy until the shit hits the fan and I promise and know that precipitating events happen in a flash. It’s one fall, or surgery, or diagnosis or unpaid mortgage etc etc that causes a catastrophic downfall. Ask me how I know!

It’s nearly impossible once something awful happens to make decisions, legal or otherwise, especially if there are no plans in place.

[Anonymous]

You cannot give them a substantial amount of money. You need to focus on your own goals - homeownership, retirement and college savings. Think about your children. If you fail to fund your own retirement are you going to expect your children to do it when they have to pay off student loans cause you also didn't pay for college? Don't push this problem onto them.

If you ILs are adamant then let them stay in the house. Do not pay for major repairs on a house that will be a teardown when its finally sold. If it needs a new roof but they can't afford it then they can live with the old one. They need to take ownership of their decisions. You can give them small amounts of money but I generally think its better to pay certain bills so you know where the money goes. For example you could add them to your cell phone plan or set up some kind of regular grocery delivery. If they start complaining your only response is that you will help them look for another place to live. And at their age you should be looking at independent living that can transition to assisted living. Don't look for another house, the reality is they are past that point.

FWIW, my ILs are also making poor choice concerning staying in their home. Its more for health reasons than financial reasons but we can't force them out so we're just waiting. There will be some big event - probably a fall or other health emergency that will change the situation. It sucks to just sit and wait for that but that's where we're at.

[Anonymous]

As a couple

[Anonymous]

Anonymous wrote:As a couple

Ganging up!

[Anonymous]

It’s totally unrealistic to think that moving them to a smaller newer house will solve this—it only kicks the problem down the road. They aren’t going to be able to live independently for long, if they even can now (doesn’t seem like it’s working). Eventually something will happen. It kind of doesn’t matter if the house falls apart.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We have a frustrating, stressful situation going on with my in laws. This will be long as it is complicated, but I would love some advice from anyone who may have been there before (my condolences).

* In laws are in early 80s, with moderate health problems, but can live independently and safely drive. They’re mentally competent but there are a couple signs of early dementia for one of them and they have become deeply sentimental at this stage in life. DH’s sibling lives nearby and regularly checks on them. We live across the country.

* They are terrible with finances — making poor “investments,” buying collectibles on eBay, going out to fancy dinners because keeping up with appearances is very important to them. They owe $100,000 on their mortgage. They are almost out of money. FIL works a few days a week for pocket money. DH and his sibling deposit a modest amount of money to their account on a semi-regular basis.

* They are deeply, emotionally connected to their large ramshackle house. They are terrible about upkeep and have always cut corners or done failed DIY projects. The house needs $100,000 in repairs to make it sellable/more livable, $200,000 to make it competitively sellable/more permanently livable. It somehow assessed for $600,000 (large lot with water access on coastal state). Even with the lower end of repair work done it would likely be a developer buy where the house would be torn down.

* They are in denial about their circumstances, and their plan is to stay in their house until the end of their days. They joke that will have to take them out feet first, even though, like the majority of people, especially those with health problems in their senior years, they will likely require assisted care at some point. For one, that could be within the next couple of years; the other could probably live independently for maybe 10 years.

* ALL of their problems could be solved by selling which would let them move into a smaller, safer, newer home; pay off their mortgage debt; and enjoy the remaining cash flow from the sale to help see them through the end of their days (or most of them).

* They absolutely refuse to sell. But the house is in such poor shape that they don’t qualify for a reverse mortgage. They could take out a home equity loan but wouldn’t be able to make the payments on it because they would need so much work done, and it also doesn’t help with daily expenses the way a reverse mortgage could.

* DH’s sibling just bought a house and isn’t in the position to give them the money they need to make the repairs. DH and I could make their home equity loan payments for them, but it would mean we’d have to stop making contributions to our 401k, for who knows how long. We are also saving to buy our own home and have kids who need to go to college one day, so it’s not ideal. DH is willing to do it, but I am not.

* Getting them to sell is the best choice for everyone of course. It buys them financial freedom, gives them a safer place to live, and cash to work with. But they are dead set on staying, even at the risk of continuing to minimally improve their living situation while worsening their financial situation, and even if their continued bad choices keep money out of the pockets of their children who keep financially helping them.

Outside of eventually having to get POAs to take over handling this horrible property and their finances when they eventually get too elderly to manage it, is there anything else we could possibly do? I have suggested that DH and his father meet with a financial planner to have a third party show them how selling would be a positive and staying would be a negative. I also suggested that he try to set up a meeting with a family counselor who can help walk through some of these very deep, emotional connections they are feeling to the house, as the reality of their situation just isn’t sinking in. He is game but needs to talk to his parents about both and doesn’t know if they will buy in to either. In the meantime, he is wracking his brain to see if there’s any other financial way for his parents to stay in their beloved (dilapidated) house but I truly think there’s no other option. Either they sell, or they stay and stay consumed with underfunded repairs they will constantly be in debt for. And eventually we will be too.

If you do not yet own your primary residence, and 401ks and 529s are not fully funded, then you CAN NOT afford to help financially. You have to bring DH around to grasp this. It is incredibly poor judgement to put your own financial future and the future of your children at risk in order to fund your in-laws' preferences. It would be a different call if you were using the funds for groceries or critical medications or to keep the heat on.

THIS. The only reason they can stay is because you are prioritizing them over your own financial future. Is that the legacy you want to leave for your kids? Let them know that you will not be putting money into their current home. Let them remove that option from their decision-making process.

[Anonymous]

The plan to make the payments is a bad one. You could end up losing that house in multiple scenarios if probate goes awry or a nursing home or Medicaid or hospital bill collector comes for the asset. If you went forward with this you would need to buy the house from them and take in the mortgage, effectively, and have them live rent free.

[Anonymous]

Folks in their 80’s with a $100K mortgage they can’t service, secured by a dwelling that is falling down around their ears, are not in a good place.

Hard as it may be, you should consider the admonition to “put on your own oxygen mask first.” If you and your husband’s siblings get dragged down with his parents everybody loses.

I wonder if you found a brand new place of manageable size, perhaps in a planned community with some amenities, you might be able to convince them that they’d be “trading up.” This might be more effective than convincing them their sentiment-laden home isn’t suitable any more. They bought a good place. They enjoyed it. They built up equity. Now is the time to cash out and enjoy the fruits of their prudence. Bonus points if they already know somebody who lives there or near there.

I think there is software that you can use to generate illustrations of how their favorite chairs, etc., would look in the new place.

Another suggestion before selling would be to contact a lawyer who is a member of the National Academy of Elder Law Attorneys to perhaps incorporate Medicaid planning into any transaction. A residence that a person intends to return to (however unlikely it is that that would occur) is treated very differently than a bag of cash or something jointly owned. Assets can also move between spouses to qualify for nursing home help. I know this isn’t on the table right now, but given their age it could come up any time.

[Anonymous]

Their dementia is almost certainly worse than you think. Being in the same house they know well hides that. There is a very real chance that if they move, their dementia will appear to get much worse, though it was in reality always bad.

You need to stop sending money—you can’t afford it.

You could consider raising the issue of their competence with a social worker. The problem is that it will be very hard on your DH.

[Anonymous]

1. Start identifying nursing homes that take Medicaid.

2. Let them live their live in this house, without repairs, until the roof gets torn up or they end up in hospital.

3. Pay down the remainder of their assets for the best nursing home in the area that takes medicaid and when they run out, they will there as Medicaid patients.

4. This solution will mean your husband and his sibling will not inherit the house, as it will be used to pay for the nursing home. You can consult an estate attorney to see if there are workarounds to keep the property from Medicaid but my understanding is that this needs to be done years before their entry into care.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We have a frustrating, stressful situation going on with my in laws. This will be long as it is complicated, but I would love some advice from anyone who may have been there before (my condolences).

* In laws are in early 80s, with moderate health problems, but can live independently and safely drive. They’re mentally competent but there are a couple signs of early dementia for one of them and they have become deeply sentimental at this stage in life. DH’s sibling lives nearby and regularly checks on them. We live across the country.

* They are terrible with finances — making poor “investments,” buying collectibles on eBay, going out to fancy dinners because keeping up with appearances is very important to them. They owe $100,000 on their mortgage. They are almost out of money. FIL works a few days a week for pocket money. DH and his sibling deposit a modest amount of money to their account on a semi-regular basis.

* They are deeply, emotionally connected to their large ramshackle house. They are terrible about upkeep and have always cut corners or done failed DIY projects. The house needs $100,000 in repairs to make it sellable/more livable, $200,000 to make it competitively sellable/more permanently livable. It somehow assessed for $600,000 (large lot with water access on coastal state). Even with the lower end of repair work done it would likely be a developer buy where the house would be torn down.

* They are in denial about their circumstances, and their plan is to stay in their house until the end of their days. They joke that will have to take them out feet first, even though, like the majority of people, especially those with health problems in their senior years, they will likely require assisted care at some point. For one, that could be within the next couple of years; the other could probably live independently for maybe 10 years.

* ALL of their problems could be solved by selling which would let them move into a smaller, safer, newer home; pay off their mortgage debt; and enjoy the remaining cash flow from the sale to help see them through the end of their days (or most of them).

* They absolutely refuse to sell. But the house is in such poor shape that they don’t qualify for a reverse mortgage. They could take out a home equity loan but wouldn’t be able to make the payments on it because they would need so much work done, and it also doesn’t help with daily expenses the way a reverse mortgage could.

* DH’s sibling just bought a house and isn’t in the position to give them the money they need to make the repairs. DH and I could make their home equity loan payments for them, but it would mean we’d have to stop making contributions to our 401k, for who knows how long. We are also saving to buy our own home and have kids who need to go to college one day, so it’s not ideal. DH is willing to do it, but I am not.

* Getting them to sell is the best choice for everyone of course. It buys them financial freedom, gives them a safer place to live, and cash to work with. But they are dead set on staying, even at the risk of continuing to minimally improve their living situation while worsening their financial situation, and even if their continued bad choices keep money out of the pockets of their children who keep financially helping them.

Outside of eventually having to get POAs to take over handling this horrible property and their finances when they eventually get too elderly to manage it, is there anything else we could possibly do? I have suggested that DH and his father meet with a financial planner to have a third party show them how selling would be a positive and staying would be a negative. I also suggested that he try to set up a meeting with a family counselor who can help walk through some of these very deep, emotional connections they are feeling to the house, as the reality of their situation just isn’t sinking in. He is game but needs to talk to his parents about both and doesn’t know if they will buy in to either. In the meantime, he is wracking his brain to see if there’s any other financial way for his parents to stay in their beloved (dilapidated) house but I truly think there’s no other option. Either they sell, or they stay and stay consumed with underfunded repairs they will constantly be in debt for. And eventually we will be too.

If you do not yet own your primary residence, and 401ks and 529s are not fully funded, then you CAN NOT afford to help financially. You have to bring DH around to grasp this. It is incredibly poor judgement to put your own financial future and the future of your children at risk in order to fund your in-laws' preferences. It would be a different call if you were using the funds for groceries or critical medications or to keep the heat on.

+1. You can not afford to help them.

[Anonymous]

OP, you need to ask your DH how he sees his parents' lives and their care needs playing out long term. Go tour a few long-term care places (just you and your DH) and let him get an eyeful and an earful of how much even a very modest place will cost. It will probably really upset him-- reality checks tend to do that and he seems pretty clueless/in denial. But this way, you're not the one trying deliver bad news. The facility and their printed materials are.

When he wants to spend money on them, your best bet is to convince him to put it in a savings account for their needs. Their *real* needs, not their desire to eat fancy food. Say to him yes, DH, I love your parents very much and I agree that we need to help them. But we need to save money for their *real* needs.

Meanwhile, you need to focus on your own family's savings goals. Look at your own budget and expenses and see what you can do-- not so that you can spend more on your in-laws, but so that you can save more for your own future and your children.

[Anonymous]

Do you have money? Will they sell you all or part of the house? If so, you make the repairs in exchange for full or partial ownership of the house, and they stay there rent free for as long as they want. When they are done with the house, you sell it.

Even if you have to forgo other savings/investments, this could be a reasonable way to save for college/retirement, as it sounds like a valuable piece of land in a desireable area.

[Anonymous]

Your DH sounds short-sighted and clueless and overly emotional (he gets it from his parents). I would start throwing money into 529s and your retirement as fast as you can. That will be the best way to keep it from going to the in-laws.