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:OP, the reason there is no path to making the finances work is because the house is a tear-down. Your inlaws got into this situation over YEARS and YEARS. Any money spent to improve the house is throwing good money after bad.

And the best answer their kids can give them is to tell them you are really sorry that there is not a financial option that will let them stay in the house. It is too bad there is a bunch of deferred maintenance and they can't afford to fix it, but there are all kinds of things I want and can't afford.

You guys are not in a position to help, not really. (If helping is at the exclusion of college and retirement savings.) This is a huge problem and if you start throwing money at home repairs you might as well be lighting it on fire. Your inlaws have a path out. They just need to know that there is no money fairy coming to let them have everything the way they want.

Thank you for your comment. I 100% agree, and these statements are literally exact things I have said to my husband. They have made so many complex bad decisions. I can’t believe they even owe money on this house that they bought more than 25 years ago, but that shows you how little they have been paying down their original mortgage, and how much they have been spending on fancy brunches and crap from eBay. They have a wonderful, perfect escape hatch out of this terrible situation, they put them self, and that will clear their debt, give them cash, and let them live in a really safe, spacious house. It is so incredibly selfish to me that they just want to stay and keep throwing money into this hole in the ground, quite literally.

Others have covered this, but just to reiterate, you should absolutely not damage your family's financial future to coddle them. If they were in danger of being homeless, that's a different story. But they're asking you to put off purchasing a home and funding your retirement and kids' education to enable their lifestyle choices - unreasonable and impractical choices at that.

Another point to reiterate - whatever happens, your husband or his sibling should try to get a financial POA immediately. Because of their history of bad decisions, they could put themselves back here even if they sell the house. They have a small margin for error now, but next time, you could find yourself in a situation where you *have* to help them out.

[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.

The house is in poor shape. We’re not in a great position to buy it / buy into it as it comes at a risk of our financial security for the future. I see a broken down house I don’t want to invest in or be left or purchase in a state 3,000 miles from where we live to be a gigantic stressor. We don’t know how the market would be when it comes time to sell; we don’t know if, being on water and in a flood plain, it may not be as sellable as it may seem to be, or if there are environmental issues with the house/land that would create more problems trying to unload it; we don’t know if it won’t sell and we are stuck making payments on it when we don’t currently own a home at this time. Bottom line: we do not want this house. It’s not a quick sell and it’s not a flip; but the bottom line is we are not financially risky people who are well off enough or have the time or ability to deal with this property. Again, if we were entrepreneurs, savvy home owners, house flippers, or had the time and means to take a gamble on this turf of a property, yeah, maybe it would be worth a potential gamble. But there is no desire at all to get involved other than DH feeling guilty that his parents “dying wish” is to stay in this nightmare of a house and they don’t have the cash to stay and want a hand out.

[Anonymous]

OP, it sounds like your kids aren't college-aged yet. And you're early in saving for retirement, maybe?

There are calculators online that will help you both project a) what you need to save for retirement and b) what you need to save to pay for college for your kids.

(Side note on that, just use your state college flagship as a baseline -- if you want to pay for out of state or private, you will need to save much, much more. Take a look at current cost of attendance figures for colleges -- it's eye-opening).

You have to put your own oxygen mask on first, but getting cold hard figures of how much oxygen your family is going to need will help both you and DH in grappling with reality.

You also need to have a hard discussion with your DH about the power of compounding interest. It is far more valuable to save a dollar today than it is 10 years from now (which I'm sure you know); online calculators are also very helpful to illustrate how hard it is to catch later on deferred education and retirement savings.

One factor I would take out of the equation is inheritance. Do not approach this issue as your in-laws "squandering their kids' inheritance." There is no inheritance under these facts.

I agree with PP that you and DH could agree to help the ILs with funds to pay for the essentials of life, but you shouldn't put a dime into this house. It's a money pit and you shouldn't throw good money after bad.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:OP, the reason there is no path to making the finances work is because the house is a tear-down. Your inlaws got into this situation over YEARS and YEARS. Any money spent to improve the house is throwing good money after bad.

And the best answer their kids can give them is to tell them you are really sorry that there is not a financial option that will let them stay in the house. It is too bad there is a bunch of deferred maintenance and they can't afford to fix it, but there are all kinds of things I want and can't afford.

You guys are not in a position to help, not really. (If helping is at the exclusion of college and retirement savings.) This is a huge problem and if you start throwing money at home repairs you might as well be lighting it on fire. Your inlaws have a path out. They just need to know that there is no money fairy coming to let them have everything the way they want.

Thank you for your comment. I 100% agree, and these statements are literally exact things I have said to my husband. They have made so many complex bad decisions. I can’t believe they even owe money on this house that they bought more than 25 years ago, but that shows you how little they have been paying down their original mortgage, and how much they have been spending on fancy brunches and crap from eBay. They have a wonderful, perfect escape hatch out of this terrible situation, they put them self, and that will clear their debt, give them cash, and let them live in a really safe, spacious house. It is so incredibly selfish to me that they just want to stay and keep throwing money into this hole in the ground, quite literally.

Others have covered this, but just to reiterate, you should absolutely not damage your family's financial future to coddle them. If they were in danger of being homeless, that's a different story. But they're asking you to put off purchasing a home and funding your retirement and kids' education to enable their lifestyle choices - unreasonable and impractical choices at that.

Another point to reiterate - whatever happens, your husband or his sibling should try to get a financial POA immediately. Because of their history of bad decisions, they could put themselves back here even if they sell the house. They have a small margin for error now, but next time, you could find yourself in a situation where you *have* to help them out.

Thank you. Yes, we have talked about POAs; I don’t think it will fly because they don’t seem to think they need it. We have plans for who will manage the estate and end of life decisions, they and sibling are on board and it has been notarized. Our charge now is to try to funnel them into making the right choice that doesn’t drown them in this house and it’s never ending needs and also pull down their children trying to support (enable) them.

[Anonymous]

What is the absolute worst that could happen? They live in a house with a leaky roof? They're not going to be homeless.
My grandparents lived in a decrepit hoarder's house; the place was falling apart and they couldn't be convinced to leave. They got into their 90s and eventually died of old age within a year of each other without any nursing home stay. Sold as-is and torn down. Maybe that will happen to you.

[Anonymous]

Anonymous wrote:OP, it sounds like your kids aren't college-aged yet. And you're early in saving for retirement, maybe?

There are calculators online that will help you both project a) what you need to save for retirement and b) what you need to save to pay for college for your kids.

(Side note on that, just use your state college flagship as a baseline -- if you want to pay for out of state or private, you will need to save much, much more. Take a look at current cost of attendance figures for colleges -- it's eye-opening).

You have to put your own oxygen mask on first, but getting cold hard figures of how much oxygen your family is going to need will help both you and DH in grappling with reality.

You also need to have a hard discussion with your DH about the power of compounding interest. It is far more valuable to save a dollar today than it is 10 years from now (which I'm sure you know); online calculators are also very helpful to illustrate how hard it is to catch later on deferred education and retirement savings.

One factor I would take out of the equation is inheritance. Do not approach this issue as your in-laws "squandering their kids' inheritance." There is no inheritance under these facts.

I agree with PP that you and DH could agree to help the ILs with funds to pay for the essentials of life, but you shouldn't put a dime into this house. It's a money pit and you shouldn't throw good money after bad.

Thanks for your thoughtful message. Yes, we have young children and 529s for them that are not fully funded yet as they are under age 5. We are also saving for a home ourselves. And we are making solid payments to our 401k but it’s maxed for just one income as I work PT and am home PT as primary caretaker for toddlers. Could we stop paying into our 401k to toss money at their house? Technically, yes. It’s money we don’t “see” as it goes into the account automatically. But doing so for 5 or 10 or more years is extremely scary to me and I don’t want to be so risky. We expect zero from inheritance / estate; in fact, we’re already planning on the expenses we will have to undertake when the time comes because they of course have said nothing aside for end of life requirements, and we will need to pay for funeral expenses, junking out the house, etc.

[Anonymous]

Anonymous wrote:What is the absolute worst that could happen? They live in a house with a leaky roof? They're not going to be homeless.
My grandparents lived in a decrepit hoarder's house; the place was falling apart and they couldn't be convinced to leave. They got into their 90s and eventually died of old age within a year of each other without any nursing home stay. Sold as-is and torn down. Maybe that will happen to you.

Is it terrible that I think this would be the best case scenario? I truly do. I think, at the least, the roof needs to be repaired. I know that can range from $10,000-$30,000. Maybe we agree to contribute $10,000 to the cost of it, paying it directly to the vendor to make sure the funds go where they are needed, and then let the in-laws figure out how to finance the rest of it, likely through a home equity loan, as they won’t qualify for any other type at this moment.

[Anonymous]

Giving in-laws money in this situation is the definition of insanity. Your primary responsibility is to your own children.

[Anonymous]

Anonymous wrote:

Anonymous wrote:What is the absolute worst that could happen? They live in a house with a leaky roof? They're not going to be homeless.
My grandparents lived in a decrepit hoarder's house; the place was falling apart and they couldn't be convinced to leave. They got into their 90s and eventually died of old age within a year of each other without any nursing home stay. Sold as-is and torn down. Maybe that will happen to you.

Is it terrible that I think this would be the best case scenario? I truly do. I think, at the least, the roof needs to be repaired. I know that can range from $10,000-$30,000. Maybe we agree to contribute $10,000 to the cost of it, paying it directly to the vendor to make sure the funds go where they are needed, and then let the in-laws figure out how to finance the rest of it, likely through a home equity loan, as they won’t qualify for any other type at this moment.

Tell them they need a HELOC and let them spin their wheels for a while figuring out how to get it. Either they won't be able to get it together due to the dementia, or they'll get a reality check as to the value of their property. That way you can defer this decision for a while.

You need to operate under the assumption that the dementia is a lot worse than is visible to you.

[Anonymous]

I wouldn’t give money if I didn’t have complete control over their finances. They have proven to be irresponsible spenders. In essence, YOU are buying the crap from eBay.

[Anonymous]

Anonymous wrote:Giving in-laws money in this situation is the definition of insanity. Your primary responsibility is to your own children.

This is right. To include spending 10k for roof repairs. Putting that money into your toddler's 529 now would likely fund their future college for a year.

OP, your heart is in the right place but the leaky roof is a symptom and addressing that won't help fix the root cause. $10k for a roof this year. $5k for something else critical next year. The list will go on and on.

[Anonymous]

Contact Habitat For Humanity and ask if the organization would be able & willing to make some urgently needed repairs.

[Anonymous]

OP: Are you willing to share the state in which the house is located ? (There may be some options based on this.)

[Anonymous]

Anonymous wrote:OP: Are you willing to share the state in which the house is located ? (There may be some options based on this.)

Thank you. I’ve begun looking into senior assistance for related housing issues in their state. They are in GA.

And thank you everyone for your thoughtful replies. Whether advice or to confirm my gut feelings or in solidarity, I really appreciate it. DH and I have had some tension over this this week and it’s really helpful to “talk” through this scenario with you helpful anon strangers so he and I can take a break from the intense discussions.

[Anonymous]

Habitat For Humanity is based in Americus, Georgia--which should be near your folks. They do repairs in addition to building homes.

While the operational HQ is in Americus, Georgia, the administrative HQ is in Atlanta.