My MIL has lived/rented in the same house for 20 years and earlier this year the owner died from old age. Well, the property mgmt company wants to sell it and asked her if she would like to buy it for $140k. My MIL lives off her SS and her very p/t job (10-maybe 15 hours a week) so she can't afford it. My SIL recently (June) moved in because her work contract ended, and she decided she didn't want to teach English overseas anymore. She's currently unemployed but working on a certification for a job she's eyeballing. She tried to get a home loan to buy the house but of course she was denied. Now they are looking at my husband for help and he wants to help. My issue is that it would add another $500 to our mortgage payments and increase our total home loan. I told him if it was short term like a year or maybe 2 ok, but it's not. He's an amazing husband, father, brother, and son and I'm glad he's who he is BUT I don't agree with this. I think his mom needs to move into a senior citizen home and not put this kind of responsibility onto her kids because she doesn't want to move. Am I wrong for feeling like this? Has anyone refinanced their home for a parent?
What would happen if you or your husband were to lose your jobs or were forced to cut back drastically on your hours?
What would happen if you or your husband were to have an accident and be unable to work for 6 months or so?
You say MIL has been renting this house for 20 years. How old is the house? 20 year old house is one thing a 50 or 100 year old house is another.
What renovations will have to be made to the house in order to allow MIL to remain? Will there need to be an accessible bathroom done? Is there a first floor bedroom that she can use if she can not do stairs? (unless this is a ranch house)
How much work can you and or your husband do when the house needs repairs?
If you are living in a cold area are you ready to shovel and plow that driveway and sidewalk and do yours as well? And the lawn in the summer.
And is $149k the market rate or is there a bit of a break since she has rented for so long?
Is this an "as is" sale and no inspection? Is there work that needs to be done?
Will all repairs be done before the sale closes?
And the biggie....
Will you get your money back?
When MIL dies will the house be sold and you recoup your investment or will SIL take up permanent residence and you will be landlords for 20. 30, 40 years?
If MIL and SIL will be paying you rent at either the same rental or a bit higher this might not be a bad deal. But I would not do it unless
1. I had enough that if I was unable to work for a while I would still be able to pay the mortgage.
2. MIL and SIL sign a rental contract and they pay rent at an amount that will either pay the mortgage each month or at a rate that would be customary in the area for a house.
3. It was safe for MIL to remain there.