Should I pay my brother rent?

[TurdMiner]

Thank you all for replying. Just talking about it helps. A little.

Yes there are a number of things I could have done better in 2006.

But what are my options today given the current situation? My brother has tied up my investment/inheritance for at least a decade. Reducing the rent I pay him would help me save up some money and pay bills. We have no written agreement as to what rent should be. We are both on title. Even if I do pay him rent, there is still a possibility he might someday in the future default on his loan on our house. Anyone know what the rules in CA say about a dual ownership where one person has borrowed against all the equity and the bank wants to foreclose? Won't the bank claim that I am trying to scam them by allowing my brother to borrow against our house and then claiming my half if things go bad?

 

[JS80]

Originally posted by: TurdMiner
Thank you all for replying. Just talking about it helps. A little.

Yes there are a number of things I could have done better in 2006.

But what are my options today given the current situation? My brother has tied up my investment/inheritance for at least a decade. Reducing the rent I pay him would help me save up some money and pay bills. We have no written agreement as to what rent should be. We are both on title. Even if I do pay him rent, there is still a possibility he might someday in the future default on his loan on our house. Anyone know what the rules in CA say about a dual ownership where one person has borrowed against all the equity and the bank wants to foreclose? Won't the bank claim that I am trying to scam them by allowing my brother to borrow against our house and then claiming my half if things go bad?

The bank doesn't care. They will take your house if he defaults. I'm guessing it's a HELOC.

You have no options. Your brother, being a RE agent, obviously knows mortgage finance. He completely took advantage of you. That is that. You can try to convince him to restructure the home and loan so that you take over the mortgage and own the house for yourself but it sounds like he knows what he's doing so it would be in his interest to keep the status quo then sell the house 25 years from now when it's back to $366k.

 

[TurdMiner]

Only my brother was on title when he took the loan out, albeit with my permission. I had to twist his arm to put me on title, and he made me do all the leg work with the county. He was the executor of our grandmother's will, but is unsure how only he was put on the title of our house.

Another way to put this, what is my best bet financially? Typically in CA, it takes 12 months to foreclose on a house. If I stopped paying rent, I would save about what I would get now if I sold the house (not counting things like filing a homestead declaration and the fact he has no interest in selling). Then I could buy a house in my name and not have my finances tied with his, and in 25 years have my own equity that I have built up.

 

[TurdMiner]

HELOC is what I believe his loan is on our house

 

[lupi]

Originally posted by: JS80

Originally posted by: waffleironhead
The current value has nothing to do with anything. Why the hell are you paying him rent. If you effectively owned/own 50% of the house, why is there any rent involved from your standpoint. were you paying yourself rent? I simply do not understand. What am i missing?

You're not missing anything, his brother was taking advantage of his disability to do math.

not to mention with his brother having taken out his half in a loan, his brother effectively has no value on the house till payed back. bro riding you like a drunk sorority chick.

 

[TallBill]

Your brother sucks.

 

[PieIsAwesome]

What's sad is that its your brother screwing you over. If I can't trust any of my immediate family then how could I trust anyone.

 

[silverpig]

Originally posted by: JS80

Originally posted by: waffleironhead

Originally posted by: Farang

Originally posted by: waffleironhead
The current value has nothing to do with anything. Why the hell are you paying him rent. If you effectively owned/own 50% of the house, why is there any rent involved from your standpoint. were you paying yourself rent? I simply do not understand. What am i missing?

Market rate for rent is $1300. He owns 50% of the house, but must pay to rent the other 50% for $650 per month.

That said I doubt you're obligated legally to pay him anything. Your name is on the deed, you can live there. I would consult a real lawyer and find out your options.

Gotcha, he is paying to his brother the amount of rent that he would be missing out on.

he should not be paying rent. they both own the house equally, if he's paying his bro $650, why isn't his bro paying him the other half $650? They live together. He is getting swindled.

It's like charging your wife that you own a house with rent!

They don't live together. They own a house together. They used to rent it out to a third party for $1300/mo. They each collected $650/mo on that rented house.

Now he is living in the house and is paying $1300. He collects $650 of that back and his brother gets $650. Net result is he pays his brother $650/mo.

Isn't there a way to sell the house for $200k, have him take his $100k and leave his bro with $100k and $183k in debt?

 

[cheezy321]

Damn OP you are in a shitty situation.

You should immediately talk to your brother about not paying rent. That is BS that he owes as much as the house is worth and you are still paying him like you own 50% of the house. If the house went into foreclosure, it sounds like he would be screwed more than you.

He might have gotten the advantage of the mortgage money in 2006, but now it seems like you would have the advantage to walk away from this scot free.

Im not involved in real estate at all, however. So i really have no idea what i am talking about.

Bottom line: Your brother screwed you over big time.

 

[xSauronx]

Originally posted by: waffleironhead
The current value has nothing to do with anything. Why the hell are you paying him rent. If you effectively owned/own 50% of the house, why is there any rent involved from your standpoint. were you paying yourself rent? I simply do not understand. What am i missing?

OP is a retard and his brother is a royal asshole.

i say instead of rent, kick the brother in the balls once a month, because OP, you seem pretty well fucked here.

 

[kranky]

This stinks.

The brother has already got his half of the value, and you can't get yours if you sell because the loan would have to be paid on closing and the brother won't/can't pay it.

If you sold the house now and took half the sale price ($100K), you would still be screwed out of a fair settlement. And you can't even exercise that option if he won't pay the loan.

He probably didn't intend to screw you, but he doesn't want to make it right now that it turned out that way.

I would do this... Tell him that because of the circumstances...
- where he got his half upfront
- you can't get ANYTHING now because there's no equity
- there's little chance that you will ever be able to get $183K from the house, since the value would have to go up 83% before you could both get $183K from the sale (and his half would repay his loan)
- you need money

...That you are going to not pay any more rent starting in September. But you are using the house so he is entitled to something. $650 is 0.36% of $183K, so each month you credit his side of the ledger with 0.36% more ownership of the house. Keep in mind he will no doubt stop paying any of the bills, so you won't actually save $650/month since you'll be paying ALL the bills.

That way he's getting more equity in the house but no cash. You're giving up equity but keeping your cash. If he objects, just point out it's exactly what he did in taking out a loan - reducing his ownership in exchange for cash.

 

[XZeroII]

I'm surprised no one has asked...

What did he blow $183,000 on???? Where is that money now?


You made a huge mistake by asking to be put on the title. You're screwed now. Either live with it and hope that home prices go up soon or sell it.

 

[thegimp03]

You and he inherited the house and you are on the deed. Why are you paying him rent? He's seriously screwing you over.

You didn't sign the papers to borrow against the house, did you? I hope you can't be held liable for his f-up. Maybe you should just move out to somewhere else. Then when he figures out that he can't rent the house for that much anymore as rent prices have plummeted, and he can't make payments, he'll put a gun in his mouth and pull the trigger.

Edited to correct grammar. I exploded when I read what he was doing to you as it is mind-numbing.

 

[TurdMiner]

So is there any consensus on what would happen if he stopped paying his loan on our house? This could happen whether I pay him rent or not. I wont say what he spent the $183,000 on because it will make him look worse. My brother and I HAD agreed to use this house to invest in more property.

And why was putting myself on title a bad idea? It is what my grandmother trust specified and I felt obligated to see it fulfilled.

Yes I am an idiot. There is a million things I could have done better, but I was more concerned with finishing my last two years of college. Bottom line, I should have payed a couple hundred to talk to an account and/or lawyer before deciding to even keep the house. But what can I do now?

(I was paying my brother $25 bucks a month to manage the property and pay the bills. That stopped when I found out he was not paying the bills. I have repeatedly asked him to send all the bills to me and that I would pay. Last weekend he hit me up for a utility bill that was 10 days past due)

 

[JS80]

Originally posted by: kranky
This stinks.

The brother has already got his half of the value, and you can't get yours if you sell because the loan would have to be paid on closing and the brother won't/can't pay it.

If you sold the house now and took half the sale price ($100K), you would still be screwed out of a fair settlement. And you can't even exercise that option if he won't pay the loan.

He probably didn't intend to screw you, but he doesn't want to make it right now that it turned out that way.

I would do this... Tell him that because of the circumstances...
- where he got his half upfront
- you can't get ANYTHING now because there's no equity
- there's little chance that you will ever be able to get $183K from the house, since the value would have to go up 83% before you could both get $183K from the sale (and his half would repay his loan)
- you need money

...That you are going to not pay any more rent starting in September. But you are using the house so he is entitled to something. $650 is 0.36% of $183K, so each month you credit his side of the ledger with 0.36% more ownership of the house. Keep in mind he will no doubt stop paying any of the bills, so you won't actually save $650/month since you'll be paying ALL the bills.

That way he's getting more equity in the house but no cash. You're giving up equity but keeping your cash. If he objects, just point out it's exactly what he did in taking out a loan - reducing his ownership in exchange for cash.

Do you really think he has the ability to offer such a complicated financial proposal to his brother??

 

[Mo0o]

Wow your brother is a major league douchebag and fuckup

 

[JS80]

Originally posted by: TurdMiner
So is there any consensus on what would happen if he stopped paying his loan on our house? This could happen whether I pay him rent or not. I wont say what he spent the $183,000 on because it will make him look worse. My brother and I HAD agreed to use this house to invest in more property.

And why was putting myself on title a bad idea? It is what my grandmother trust specified and I felt obligated to see it fulfilled.

Yes I am an idiot. There is a million things I could have done better, but I was more concerned with finishing my last two years of college. Bottom line, I should have payed a couple hundred to talk to an account and/or lawyer before deciding to even keep the house. But what can I do now?

(I was paying my brother $25 bucks a month to manage the property and pay the bills. That stopped when I found out he was not paying the bills. I have repeatedly asked him to send all the bills to me and that I would pay. Last weekend he hit me up for a utility bill that was 10 days past due)

Was it online poker?

If your bro stops paying on the HELOC you both will lose the house.

 

[lupi]

Originally posted by: TurdMiner
So is there any consensus on what would happen if he stopped paying his loan on our house? This could happen whether I pay him rent or not. [/b]


since it's a home line, it pretty much becomes a 2nd mortgage which means same as that going bad (i believe)

I wont say what he spent the $183,000 on because it will make him look worse. My brother and I HAD agreed to use this house to invest in more property.

um, short of him hiring a male prostitute to regularly tie him and and treat his orifices like he's done to you, I'd doubt that.

 

[JEDIYoda]

Originally posted by: OCguy

Originally posted by: TurdMiner
Thanks for the quick response! BTW I have been lurking in P&N for a number of years OCguy

Then no offense, but if you want halfway decent replies, add some cliffs.

rofl...too lazy to read again, huh???

 

[DrPizza]

Wow, can't believe no one's mentioned this yet:

Time to lawyer up rather than rely on our opinions. You're talking about a serious amount of money.

 

[TallBill]

Originally posted by: lupi

Originally posted by: TurdMiner
So is there any consensus on what would happen if he stopped paying his loan on our house? This could happen whether I pay him rent or not. [/b]


since it's a home line, it pretty much becomes a 2nd mortgage which means same as that going bad (i believe)

I wont say what he spent the $183,000 on because it will make him look worse. My brother and I HAD agreed to use this house to invest in more property.

um, short of him hiring a male prostitute to regularly tie him and and treat his orifices like he's done to you, I'd doubt that.

Yeah, I'm not sure how he could possibly look any worse.

 

[TurdMiner]

Thanks Dr. Pizza. That was what I was trying to ask. Do I take my medicine and pay rent until the market goes up 83%? Or is this worth pursuing with the services of a professional?

I guess I am just being cheap, but I don't want to pay for a lawyer for them to tell me I am screwed.

 

[kranky]

Originally posted by: TurdMiner
Thanks Dr. Pizza. That was what I was trying to ask. Do I take my medicine and pay rent until the market goes up 83%? Or is this worth pursuing with the services of a professional?

I guess I am just being cheap, but I don't want to pay for a lawyer for them to tell me I am screwed.

A lawyer could tell you in the first meeting what your options are. Better to know exactly what avenues are open to you than to wonder.

 

[Glitchny]

Originally posted by: DrPizza
Wow, can't believe no one's mentioned this yet:

Time to lawyer up rather than rely on our opinions. You're talking about a serious amount of money.

I agree with this, get a lawyer and see what your options are. Then kick your brother in the face for being a complete fuckup/asshole and stop all unnecessary contact with him. I can't believe somebody would do this to a sibling, maybe I just come from a normal family but my bro and sis would never do something like this.

and if you can't get out of this at all, call me up and we can sink his boat.

 

[911paramedic]

Originally posted by: waffleironhead
The current value has nothing to do with anything. Why the hell are you paying him rent. If you effectively owned/own 50% of the house, why is there any rent involved from your standpoint. were you paying yourself rent? I simply do not understand. What am i missing?

Exactly what I was going to ask. Half the house is yours, why are you renting your own house to yourself???

I could understand if you took on the entire house, then you should pay half of the rent you were collecting previously.

Let me ask this...when rent was paid before, how was it split? Did you get half the rent? If so, go ahead and pay rent, but ask for half (of the total) back. Do you get what I am saying? I don't understand why he gets all the profit.