Inheriting house together with sibling...who wants to move in - WWYD?

[Anonymous]

OK you are talking about $3M. So the family is asking you to give them $1.5M. Sweet deal for them. They need to buy out and get over themselves.

[Anonymous]

Anonymous wrote:OP here again - To add, I think part of why she finds this so upsetting is that my family and I actually could afford to buy her out and live there if we wanted to. We just don't. So she sees it as us having had our opportunity and since we're not taking advantage, she should. Or something.

My parents spent a lot of time and $ "evening out" things between us so she'd have the same things as me/my family (paid for her car, grad school tuition, etc.) when I got them through working hard and taking risks. I'm not sure she realizes that's not how the real world works, though she is rational in other domains.

So how much money DO you have?

If you have millions and millions, I think you should consider letting her buy you out for less than 1.5 mil.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Sibling needs to buy you out, but at a good deal. Maybe not market. At least half of what parents bought it for, adjusted for inflation, plus half of what money parents put in.

Why not at market? Why should A lose money on the deal?

I agree with other PPs, if B can't fully buy out A, then they should sell. The only compromise I would possibly consider is to allow B to pay A rent (half of market value) for a period of time (2 years) to save money to buy.

Pp here, juts realized the Problem is what if sibling sells for profit and that makes a bitter down the road?

Was there additional money given in the inheritance?

OP here - Yes, there was. It would be enough for B to send kids to private and cover some/all college expenses for 2-3 children, but not enough to buy out A's half of the home value. Even if it did cover half the home value, B would have to somehow afford private school on top of that given the neighborhood (although I suppose she'd be living mortgage-free, so maybe do-able). Also, most of it is locked in a trust for the next 10 years for Sibling A and 15 years for Sibling B, so trustee (family friend) would have to be on-board with her plans.

Sib B is an excellent negotiator for her "half" of things. Not so much for Sib A. Sib A is a doormat to even consider all this based on an "emotional; attachment" LOL..

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP here again - To add, I think part of why she finds this so upsetting is that my family and I actually could afford to buy her out and live there if we wanted to. We just don't. So she sees it as us having had our opportunity and since we're not taking advantage, she should. Or something.

My parents spent a lot of time and $ "evening out" things between us so she'd have the same things as me/my family (paid for her car, grad school tuition, etc.) when I got them through working hard and taking risks. I'm not sure she realizes that's not how the real world works, though she is rational in other domains.

So how much money DO you have?

If you have millions and millions, I think you should consider letting her buy you out for less than 1.5 mil.

Not millions and millions. We'd have to sell our current home to buy her out, for example. I would say by DC standards we're comfortable, but not particularly rich.

[Anonymous]

Anonymous wrote:OP, do not let your sibling move in, rent-free. Either they move in and pay rent to you (in addition to being responsible for utilities, and most of the property taxes).

But I think the sibling should buy you at at a fairly assessed value, or you both sell the house now, or you both hold on to it (maybe rent it out to someone else so you both get some income).

In an ideal world, siblings are kind and understanding of each other, and don't take advantage of situations. But this is not an ideal world, and situations like this can bring out some surprisingly selfish attitudes.

Not this sib B. She already seems greedy and entitled -- you will never see that rent.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Sibling needs to buy you out, but at a good deal. Maybe not market. At least half of what parents bought it for, adjusted for inflation, plus half of what money parents put in.

Why not at market? Why should A lose money on the deal?

I agree with other PPs, if B can't fully buy out A, then they should sell. The only compromise I would possibly consider is to allow B to pay A rent (half of market value) for a period of time (2 years) to save money to buy.

Pp here, juts realized the Problem is what if sibling sells for profit and that makes a bitter down the road?

Was there additional money given in the inheritance?

OP here - Yes, there was. It would be enough for B to send kids to private and cover some/all college expenses for 2-3 children, but not enough to buy out A's half of the home value. Even if it did cover half the home value, B would have to somehow afford private school on top of that given the neighborhood (although I suppose she'd be living mortgage-free, so maybe do-able). Also, most of it is locked in a trust for the next 10 years for Sibling A and 15 years for Sibling B, so trustee (family friend) would have to be on-board with her plans.

Sib B is an excellent negotiator for her "half" of things. Not so much for Sib A. Sib A is a doormat to even consider all this based on an "emotional; attachment" LOL..

OP here - maybe so. I tend to see it as considering it based on an interest in preserving my good relationship with my sister and not being sure it's worth fighting over between us.

That said, PPs have raised concerns I'd not considered (liability issues, for example) which makes me think that pushing back on this is the best course of action.

[Anonymous]

Anonymous wrote:A will can easily divide a family unfortunately as I witnessed in my family. Is there someone that you can hire - like an estate attorney that can "be the heavy". He/she can draw up different plans with monetary amounts attached and present them to you and your sister and that can be the starting point of a conversation. That way you are not presenting the news directly to your sister. I personally think that your sister thinks that you will let her live there rent free because you are already established with a home/family. She may be trying to take advantage of your good will. And it will cause worse issues later on because I'm sure she wouldn't vacate a 3 million dollar house without a fight.

I think there's value to this idea. Having the bad news come from a third party could help preserve your relationship. It might also help her realize what's reasonable/unreasonable in this scenario.

Your story reminds me of my younger sister. Very well educated, involved in a lot of issues, but not paid for what she does and can't seem to bring herself to do any mundane regular job. My dad died last year, and she now lives in the house rent free. Difference is its a $350k house, and dad also left a lot of money so taxes and upkeep are not such a burden. How high are the property taxes? I can't imagine she's thought about that.

[Anonymous]

I'm a trustee on my grandparent's trust and was in a similar situation, but a bit more complicated. Keep the house owned by the trust if it's not already, then the one who wants to live there can buy it back by paying loan installments.

So basically, the trust is giving a rent-to-own loan of $1.5m, and the monthly payments would go to you (indirectly).

Where is gets complicated is when improvements or repairs need to be made. Repairs would be covered by the trust, but let's say they want to put a pool in... Figure out how to handle taht.

A good estate lawyer can advise on the options here -- they've dealt with this before I'm sure.

[Anonymous]

My parents spent a lot of time and $ "evening out" things between us so she'd have the same things as me/my family (paid for her car, grad school tuition, etc.) when I got them through working hard and taking risks. I'm not sure she realizes that's not how the real world works, though she is rational in other domains.

The most fair and even thing to do is to sell and split proceeds in half. There is no question, now or later, about who got the better deal. She will be inheriting 1.5 million, which is surely enough to put a large downpayment on a place within her means. I would discuss it in terms of not only fairness but clarity, and how important it is for the two of you to be able to preserve your relationship without issues or resentments. BTW your parents weren't 'evening' out things, they were protecting/babying her.

[Anonymous]

Anonymous wrote:OP here again - To add, I think part of why she finds this so upsetting is that my family and I actually could afford to buy her out and live there if we wanted to. We just don't. So she sees it as us having had our opportunity and since we're not taking advantage, she should. Or something.

My parents spent a lot of time and $ "evening out" things between us so she'd have the same things as me/my family (paid for her car, grad school tuition, etc.) when I got them through working hard and taking risks. I'm not sure she realizes that's not how the real world works, though she is rational in other domains.

OP We went through this with a $1M house in MD. At first there was a sentimental desire to keep the home and rent it out --we are the poorer half. But we did not want to be "working" for the sister/BIL. They were out of town; we are here, so we would have been doing all the upkeep and dealing with the renters. Then they offered to sell us half the appraised value, and we could be landlords, but the home was older and we thought that for the rent charged, the renters would want a much nicer home. It was sad, but we sold the home and split the money and reinvested. Best thing we EVER did.
PS While we were packing out and fixing up the home for sale, a lot of the entitled attitude came out -- that was when we knew that selling was they way to keep family harmony. Best of luck.

[Anonymous]

NP here with another family/money story.

My dad gave my brother money to pay off his house which he owns with his wife. Now they're having some issues and it's entirely possible there's a split and my sister-in-law gets the house and/or walks with half of the money my dad intended for my brother. I think that's a consideration - and you're talking about a ton more money than our situation.

These things never end well. I truly wish you luck. I wouldn't bother getting into the whole emotional aspects of it though OP, like decoding how she's more dependent on your parents vs. you being more independent only because it will matter less and less as time goes by - if you work out something amicably for her to live in the house as the years pass she'll REALLY be attached to it, and start with the whole "I took care of the house, I upgraded this and this, I put value into the house, etc."

I think it does make sense to deal with this now. Good luck.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP here again - To add, I think part of why she finds this so upsetting is that my family and I actually could afford to buy her out and live there if we wanted to. We just don't. So she sees it as us having had our opportunity and since we're not taking advantage, she should. Or something.

My parents spent a lot of time and $ "evening out" things between us so she'd have the same things as me/my family (paid for her car, grad school tuition, etc.) when I got them through working hard and taking risks. I'm not sure she realizes that's not how the real world works, though she is rational in other domains.

So how much money DO you have?

If you have millions and millions, I think you should consider letting her buy you out for less than 1.5 mil.

If the sibling could afford to buy it if it were discounted 10-20% from fair market value, that would be one thing, but if they can only swing $500k when op's share is $1.5m, that's a whole other thing, and would be horribly unfair to op.

[Anonymous]

Anonymous wrote:

Anonymous wrote:OP here again - To add, I think part of why she finds this so upsetting is that my family and I actually could afford to buy her out and live there if we wanted to. We just don't. So she sees it as us having had our opportunity and since we're not taking advantage, she should. Or something.

My parents spent a lot of time and $ "evening out" things between us so she'd have the same things as me/my family (paid for her car, grad school tuition, etc.) when I got them through working hard and taking risks. I'm not sure she realizes that's not how the real world works, though she is rational in other domains.

So how much money DO you have?

If you have millions and millions, I think you should consider letting her buy you out for less than 1.5 mil.

Signed, Typical Moocher

NP here. Ignore that poster, OP. He's the same guy that will expect you to spring for dinner every time they choose a fancy restaurant WITH the fancy wine because THEY have champagne taste on a beer budget. Their problem, not yours.

Your sibling needs to cough up the money or ratchet down their tastes, expectations and experiences, OP. They are not at all realistic.

[Anonymous]

Anonymous wrote:

Anonymous[b wrote:]"I think B sees this as her home at least until retirement"[/b]"Emotional attachment" to the house is BS. I mean, what about Sibling B's emotional attachment to Sibling A? What B should care about is people - people being treated fairly - and not causing resentment between families that could last generations. Who does B think she is? Getting more than her share. no.

If they can't afford it, they can't afford it. Done. Period. Sell.

+1 harsh but true.

That's because it is Bs retirement.

[Anonymous]

Anonymous wrote:

Anonymous wrote:A will can easily divide a family unfortunately as I witnessed in my family. Is there someone that you can hire - like an estate attorney that can "be the heavy". He/she can draw up different plans with monetary amounts attached and present them to you and your sister and that can be the starting point of a conversation. That way you are not presenting the news directly to your sister. I personally think that your sister thinks that you will let her live there rent free because you are already established with a home/family. She may be trying to take advantage of your good will. And it will cause worse issues later on because I'm sure she wouldn't vacate a 3 million dollar house without a fight.

I think there's value to this idea. Having the bad news come from a third party could help preserve your relationship. It might also help her realize what's reasonable/unreasonable in this scenario.

Your story reminds me of my younger sister. Very well educated, involved in a lot of issues, but not paid for what she does and can't seem to bring herself to do any mundane regular job. My dad died last year, and she now lives in the house rent free. Difference is its a $350k house, and dad also left a lot of money so taxes and upkeep are not such a burden. How high are the property taxes? I can't imagine she's thought about that.

Agree with this excellent advice. Let the estate attorney lay this out for you and your sibling. With the proceeds from he house she and her spouse can likely buy a lovely house outright somewhere. You do not have to ransom your inheritance for your sister's good will. If she is asking you to do that, directly or indirectly, it is she who is being selfish and unfair. You have every right to look out for yourself and your own interests in this matter.