Jewish World Review June 30, 2000 /27 Sivan, 5760
I'm buying my dad's house
DEAR BRUCE: What is the best way to purchase a home from my dad? He is behind on paying the mortgage and is in danger of losing his house. I want to take it over but pay the least possible amount in taxes when the house is transferred to me. The house is worth $137,000, and he owes about $98,000. -- C.J., via e-mail
DEAR C.J.: Effectively, your dad would be giving you $39,000, which probably could be shaved with a low-ball appraisal so you would only pay taxes on a somewhat smaller amount. The taxes can be avoided completely by having your dad claim against his lifetime exemption and give that equity over to you. Be certain to have a competent lawyer and accountant handle the transaction, which is not all that complicated.
DEAR BRUCE: My daughter called me this evening and told me of a house that she was considering purchasing. The agent said that on the list of revealing defects, it listed a 1,000-gallon oil tank underground. I thought that I heard you comment on this years ago and remembered your saying that it could cause big problems. -- K.M., via e-mail
DEAR K.M.: You bet your life! In this crazy day of litigious activity by all manner of agencies concerned with pollution, I would be far more comfortable if the oil tank was either pulled or -- as I have had done, and which is legal in the states where I own two tanks -- certified to be a non-leaker and then filled with plastic. Then you install an above-ground oil tank to service your needs. The problem is there is no statute of limitations on pollutants. A leaky oil tank can cost a ton of money.
DEAR BRUCE: I have contacted a company that claims they can reduce my debts by negotiating with the creditors. I owe far more than I am able to pay. Right now I am still managing to make all of the minimum payments but just barely. Will this have an adverse effect on my credit standing? -- R.T.
DEAR R.T.: You better believe it. Most of the nonprofit organizations like Consumer Credit Counseling Service cannot be of assistance to you until you're delinquent. Then they will negotiate on your behalf with the creditors for lower payments and sometimes a cessation of interest. By that time, your credit is shot anyway, so I wouldn't be concerned about that.
I have no problem with the nonprofit organizations but would shy away from those that want to give you a consolidation loan or something similar. You can't borrow your way to
Send your questions to JWR contributor Bruce Williams by clicking here. (Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.) Interested in buying or selling a house? Let Bruce Williams' "House Smart" be your guide. (Sales of the book help fund JWR).
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