(Closed) I have a complex question and need some advice

posted 8 years ago in Legal
Post # 3
Member
1032 posts
Bumble bee
  • Wedding: August 2009

Don’t do this unless you have talked to someone who knows all the awnsers to this for sure. 

I used to work in the mortgage biz and I do know that a notarized document is about as good as it gets……BUT I am no lawyer. Make sure you get a third opinion before signing anything

Your dad may mean well……but you always need to watch out for yourself

Post # 4
Member
348 posts
Helper bee

NOT A LAWYER HERE (aka, this is not legal advice).  My understanding is that there is no reason you can’t write a binding contract on your own.  However, contracts involve a lot of technical language.  Without a lawyer, it can be hard to make the contract say what you want it to say.  Some parts of a contract might be unenforceable if they are not written carefully. In this case, I would be particularly worried about how well the contract specifies what percentage of the payment is interest in any given year, since that’s what you usually claim as a deduction on your taxes.

I think it would be a very good idea to pay an attorney (maybe a different one, if your Dad’s usual lawyer is dragging his feet) to review the document you’ve signed and make sure it is actually enforceable and says what you intend it to say.  If it’s already good, you’ll have peace of mind.  If not, you can make the changes you need.

If you need help finding a lawyer, you can contact your state’s bar association, which should be able to give you a list of a few people in your area who practice in the field you need.  In your case, someone familiar with both tax law and real estate law would be ideal.

Post # 5
Member
21 posts
Newbee
  • Wedding: March 2011

sounds like a law school exam question!  property law can be a very very tricky area! it cant hurt to go consult with an attorney!  usually the promissory note and contract for sale are two different documents…

Post # 6
Member
2208 posts
Buzzing bee
  • Wedding: July 2010

So, I am an attorney, but not a real estate attorney. But I can say this:

1) Two ordinary people can absolutely write up a binding contract. There is no need for a lawyer at all to make a contract binding.

2) Historienne hit my concern entirely: the calculation of interest. The percentage that represents interest can be hard to calculate. I would seriously advice contacting an attorney or an accountant to draw up an interest v. principal payment schedule so you know the right amount to deduct.

3) You probably don’t need to worry about signing the document. At the end of the day, if you defaulted it would be your parents enforcing the loan, and they aren’t going to hire a high payed lawyer to go after you.

So, get someone to calculate the interest v. principal. I think that is the main concern here.

Post # 7
Member
972 posts
Busy bee
  • Wedding: August 2010

Not a lawyer…accounting student. Few questions. Is your dad the owner of the house? Or did he simply transfer the mortgage? Who did you refinance through?

Post # 8
Member
972 posts
Busy bee
  • Wedding: August 2010

Actually the interest is not very difficult to calculate, all you need is a financial calculator. If you pm me I can walk you through it. Make sure you get all the credits that are being offered for first time homebuyers, not 100% sure if that $8000 credit is still around but it definitely doesn’t hurt to ask.

Post # 10
Member
2208 posts
Buzzing bee
  • Wedding: July 2010

@ MyraG: Okay, so it is hard for me! Smarty pants. Tongue out

@ OP: Good luck! Sounds like you guys will be fine.

Post # 11
Member
4480 posts
Honey bee
  • Wedding: March 2010 - Calamigos Ranch

This isn’t legal advice(!!!–I am not a lawyer! etc.), but I don’t think you need a lawyer to draw up a contract. However, a lot of problems with contracts can be avoided if a *good* lawyer who knows the law does it. Personally, what I would do is take it to a lawyer to review it before completing it, but what your dad did is almost certainly going to be a legally binding document. You just have to make sure that it actually says what you intend for it to say.

Post # 12
Member
972 posts
Busy bee
  • Wedding: August 2010

You will get a really nice return because your mortgage interest is deductible and that 8000 credit is still around. Take all your mortgage statements so that your accountant can easily calculate your interest paid to date

Post # 13
Member
972 posts
Busy bee
  • Wedding: August 2010

Also make sure that you take any receipts for energy improvements that you’ve done to your home. Or anything that will increase the value (I.e. Water softener)

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