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Property sales - 10/7/2014 12:56:36 PM

L8bloomer

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In another thread about "legal" slavery or slave contracts, I read the following.

quote:

ORIGINAL: littleladybug

(Sort of like "selling"a car to a relative for a dollar....the first question would be "what rule or regulation are you trying to circumvent?")

It brought up a question in my mind. If you were to purchase a large ticket item on behalf of a family member, let's say a house, and "sell" it to them for market value, is it possible for you to circumvent their payments by making the payments yourself, but they hold ownership of the property for tax purposes, etc.? I imagine it varies, depending on where one lives, but I am just wondering if such an action is possible.

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RE: Property sales - 10/7/2014 1:33:56 PM

littleladybug

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quote:

ORIGINAL: L8bloomer

In another thread about "legal" slavery or slave contracts, I read the following.

quote:

ORIGINAL: littleladybug

(Sort of like "selling"a car to a relative for a dollar....the first question would be "what rule or regulation are you trying to circumvent?")

It brought up a question in my mind. If you were to purchase a large ticket item on behalf of a family member, let's say a house, and "sell" it to them for market value, is it possible for you to circumvent their payments by making the payments yourself, but they hold ownership of the property for tax purposes, etc.? I imagine it varies, depending on where one lives, but I am just wondering if such an action is possible.

Can I respond myself?? LOL

Yes, it is very possible.

Once you get over the issue of "market value"...it generally doesn't matter who pays. I've known quite a few people who have had mortgages that mom and dad pay each month. I don't know the ins and outs of why this is done in their circumstances, but it's done, for years at a time.

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RE: Property sales - 10/7/2014 1:46:34 PM

L8bloomer

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But would they be the legal owner of the home?

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RE: Property sales - 10/7/2014 2:11:59 PM

smileforme50

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No....whose ever name is on the deed would be legal owner. I don't think the mortgage company care whose name the property is in....as long as they are getting paid and they know who to come after in case they don't get paid. Money is money.

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RE: Property sales - 10/7/2014 2:29:33 PM

darkwanderer3305

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In general, most US jurisdictions (and every bank/mortgage company I know of) demands that the name of the mortgagee be on the deed until the mortgage has been paid in full. So, IF the family member were the sole owner on the deed, and you didn't make a payment for them, the bank would foreclose on them and seek the balance + damages from the family member listed on the deed. there is, to my knowledge, no way to get a mortgage on a home listed solely in another person's name... (I work in the industry, indirectly...)

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RE: Property sales - 10/7/2014 2:34:46 PM

InHisHeart

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It doesn't matter who pays the mortgage, the bills or property taxes, the name on the deed or title is the legal owner of the house, property, car, etc.

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RE: Property sales - 10/8/2014 7:55:12 PM

DesFIP

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What does matter here is the gift tax penalty. If you do this and pay more than $14,500 a year, you will owe taxes to the IRS. The only exceptions are medical and education, paid directly to the doctor or university. You cannot repay someone for costs they incurred though.

< Message edited by DesFIP -- 10/8/2014 7:56:51 PM >

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RE: Property sales - 10/11/2014 8:00:28 AM

MercTech

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Laws vary from state to state.

A record of payment of a mortgage, or even a car, can leave the person paying the bill the owner if the registered owner dies intestate. i.e. record of payments being a case for a probate claim.

But, outside of a lawsuit and court order, the person on the deed of record is the owner. At least in the three states where I've owned property.

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