Any Real Estate Guru's?

[SViper]

My father is about to purchase a house from auction, and he wants to put it in my name for reasons I'd rather not get into. He has the money to pay it all off. He and my mother will probably be living in this house for the rest of their lives (in LA), and I'm going to be moving out of state (TX) in probably 6 months. Are there any "hidden" traps that I'm getting myself into? I do plan on purchasing a house eventually in the new state, but I'm going to be in an appartment at first. Anything I need to watch out for if I get this house in my name?

Btw, I'm 22, going to be 23 tomorrow if it matters any. I really want to help out my parents, but I need to get some more information about what I'm getting myself into. Like I said, they have the money to pay off the house outright. Any information about this situation would help greatly. I'm not well versed in real estate laws, taxes, etc. Thanks.

 

[rsd]

Yay for Tax Evasion

 

[iamwiz82]

IMHO, that sounds like a bad idea. I guess it boils down to how well you trust your father.

 

[snoopdoug1]

Originally posted by: rsd
Yay for Tax Evasion

how so? tax noob here...

 

[iamwiz82]

Originally posted by: snoopdoug1

Originally posted by: rsd
Yay for Tax Evasion

how so? tax noob here...

Primary homestead, I would assume. If you have two houses, the house where you do not reside fulltime is usually taxed at a higher rate.

 

[mugs]

Originally posted by: iamwiz82
IMHO, that sounds like a bad idea. I guess it boils down to how well you trust your father.

It sounds like a terrible idea.

 

[mattpegher]

Originally posted by: iamwiz82

Originally posted by: snoopdoug1

Originally posted by: rsd
Yay for Tax Evasion

how so? tax noob here...

Primary homestead, I would assume. If you have two houses, the house where you do not reside fulltime is usually taxed at a higher rate.

Although this may differ by state/locality, I own two places and the taxes do not depend on which one I live in or how many I own.

Unless I am wrong, owning the house outright should not negatively affect your ability to purchase a house in the future, except maybe eligibility for first time buyer and assistance programs. Now if his father has him take out some form of mortgage or loan this will affect it. If he needs any type of financial help, ie school loan or grant then the value of the house will be considered an asset.

 

[mrrman]

sounds dishonest to me from your fathers view...what is he hiding

 

[lokiju]

Your credit, so up to how much you have faith in your father paying it off fully and now having that amount of money showing as your responsibility.

 

[crystal]

Just help your parents out. If they give you any trouble, just kick them out of "your" house.

 

[JulesMaximus]

Who is going to pay the property taxes on it? That burden will fall on the person who is on title. That's really the only thing I can think of to talk to your parents about.

Otherwise, I don't see a downside to this. As long as you trust your parents and they pay the taxes.

As for your credit, this will definitely look good on your credit report. :thumbsup:

 

[JulesMaximus]

Originally posted by: mattpegher

Originally posted by: iamwiz82

Originally posted by: snoopdoug1

Originally posted by: rsd
Yay for Tax Evasion

how so? tax noob here...

Primary homestead, I would assume. If you have two houses, the house where you do not reside fulltime is usually taxed at a higher rate.

Although this may differ by state/locality, I own two places and the taxes do not depend on which one I live in or how many I own.

Unless I am wrong, owning the house outright should not negatively affect your ability to purchase a house in the future, except maybe eligibility for first time buyer and assistance programs. Now if his father has him take out some form of mortgage or loan this will affect it. If he needs any type of financial help, ie school loan or grant then the value of the house will be considered an asset.

You're right, it only affects how you are taxed on a gain when you sell the house.

 

[SViper]

Originally posted by: mattpegher

Originally posted by: iamwiz82

Originally posted by: snoopdoug1

Originally posted by: rsd
Yay for Tax Evasion

how so? tax noob here...

Primary homestead, I would assume. If you have two houses, the house where you do not reside fulltime is usually taxed at a higher rate.

Although this may differ by state/locality, I own two places and the taxes do not depend on which one I live in or how many I own.

Unless I am wrong, owning the house outright should not negatively affect your ability to purchase a house in the future, except maybe eligibility for first time buyer and assistance programs. Now if his father has him take out some form of mortgage or loan this will affect it. If he needs any type of financial help, ie school loan or grant then the value of the house will be considered an asset.

Right. I understand that part. Any mortgage loans taken against the house will directly affect my credit, seeing as I would have to sign for the loans in the first place. I don't forsee ever having to do this, but I can't predict how finances will be 5+ years from now.

Are the first time home-buyer incentives pretty substantial? I know I will be missing out on those if I get a new house in Texas, or do these sort of things not carry over to different states?

 

[JulesMaximus]

Originally posted by: SViper

Originally posted by: mattpegher

Originally posted by: iamwiz82

Originally posted by: snoopdoug1

Originally posted by: rsd
Yay for Tax Evasion

how so? tax noob here...

Primary homestead, I would assume. If you have two houses, the house where you do not reside fulltime is usually taxed at a higher rate.

Although this may differ by state/locality, I own two places and the taxes do not depend on which one I live in or how many I own.

Unless I am wrong, owning the house outright should not negatively affect your ability to purchase a house in the future, except maybe eligibility for first time buyer and assistance programs. Now if his father has him take out some form of mortgage or loan this will affect it. If he needs any type of financial help, ie school loan or grant then the value of the house will be considered an asset.

Right. I understand that part. Any mortgage loans taken against the house will directly affect my credit, seeing as I would have to sign for the loans in the first place. I don't forsee ever having to do this, but I can't predict how finances will be 5+ years from now.

Are the first time home-buyer incentives pretty substantial? I know I will be missing out on those if I get a new house in Texas, or do these sort of things not carry over to different states?

I didn't use any incentive programs when I bought my first home. My wife and I saved up enough to put down 10%. We then made enough money on the sale of that house to buy our second home.

 

[SViper]

Originally posted by: JulesMaximus

Originally posted by: SViper

Originally posted by: mattpegher

Originally posted by: iamwiz82

Originally posted by: snoopdoug1

Originally posted by: rsd
Yay for Tax Evasion

how so? tax noob here...

Primary homestead, I would assume. If you have two houses, the house where you do not reside fulltime is usually taxed at a higher rate.

Although this may differ by state/locality, I own two places and the taxes do not depend on which one I live in or how many I own.

Unless I am wrong, owning the house outright should not negatively affect your ability to purchase a house in the future, except maybe eligibility for first time buyer and assistance programs. Now if his father has him take out some form of mortgage or loan this will affect it. If he needs any type of financial help, ie school loan or grant then the value of the house will be considered an asset.

Right. I understand that part. Any mortgage loans taken against the house will directly affect my credit, seeing as I would have to sign for the loans in the first place. I don't forsee ever having to do this, but I can't predict how finances will be 5+ years from now.

Are the first time home-buyer incentives pretty substantial? I know I will be missing out on those if I get a new house in Texas, or do these sort of things not carry over to different states?

I didn't use any incentive programs when I bought my first home. My wife and I saved up enough to put down 10%. We then made enough money on the sale of that house to buy our second home.

So you don't feel that you "missed out" on first time homebuyer incentives?