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My Brother-In-Law Wants to be Included on the Deed for Our Home
I'm a 30 year-old woman seeking to buy a home with my mother-in-law. Note, I call her my mother-in-law because I’ve been with her son for over 10 years. Her son and I are not married yet. She loves me like a daughter and has stepped to fill the role as my mother ever since my biological mother passed away on November 6th, 2018.
My reasons for purchasing this home with her have nothing to do with me looking for a handout. I’m actually trying to do this with as little help as possible, while having the least impact on anyone else.
I explained that I don’t like the idea of getting something for nothing and my mother-in-law who loves me like a daughter said that she would help me pay for the home, using money that my brother-in-law had put into savings for her. (This is savings that her own earnings contributed to. He controls her finances, because due to her limited income, she has not always made the best financial choices.)
Originally, my brother-in-law and his wife were going to purchase a home for his mother-in-law, my boyfriend, and I. Eventually, that would house would belong to us once the mortgage was paid off.
That would have made the most sense at the time. I was making just $50,000 a year, a starter salary that although you can arguably buy a home in the area where we are talking about moving to, would have made it very difficult. Recently, however I received a $25,000 a year annual raise, and came into a late inheritance from my late grandmother (we sold her home… and got some money out of the deal. She had taken out a reverse mortgage when she died, and there were liens against the house because we didn't know that we still technically owned the home, after she passed away.)
However, I am at the point where I can save 25% (over $1,000) of my monthly check which in a year’s time should give me over $20,000, including the money that I already have saved up, that will contribute towards a 10% down payment for a home that is $250,000 or lower.
There are, also, government programs that may come into legislation (i.e. $25,000 down payment from the U.S. for first-generation home owners, and a $10,000 tax credit for first-time home owners) that might make it easier for me to pursue this goal. However, even if those programs do pass, my mother-in-law’s assistance could either allow us to put more equity in the home, in case we ever need to cover home maintenance costs, give us a better rate, or buy us a more valuable home.
To avoid PMI and be able to ensure that I can maintain my lifestyle during emergency, I need help procuring the other 10%, as well as emergency savings. I would never buy a home without having emergency savings... and avoiding PMI would be great.
There is a program in my state that I will qualify for as a first-time homeowner, where they will give new homeowners $10,000 towards down payment assistance or closing costs. I’m not too concerned about home inspection costs… since that should only cost $300 to $500, based on the house that we are considered purchasing. That seems feasible for me.
I, also, checked out mortgage rates and I would only need to pay 3.625% interest for a 30-year mortgage, based on my current credit score. While that’s not wonderful considering that monthly mortgages are at their lowest rates than ever, during normal times that is fine.
For those of you curious as to why I’m not waiting until I have the money to do this on my own in a few years… it’s because there are other considerations.
My mother-in-law, who will be living with me and my boyfriend, wants to retire, and due to our close proximity to NYC, where we live is very expensive. Not only is it hard on her considering that she is a former waitress, a job that didn't give her a pension or a 401(k) and drives people to the airport on the side, but she also faces nothing but drama with living so close to her sister and her sister’s children who are all pushing 40 and have no emergency savings… so they constantly rely on her and my brother-in-law for money.
While the area where we’re moving to might seem like a high cost of living compared to where other people in our country live, the cost of living is much cheaper there than it is here (think $1,700 to rent a 3-bedroom home, versus $2,200 here). (Of course, property is cheaper there too… I have a 1 bedroom apartment that I pay $1,350/month for where I currently live. There are 3 or 4-bedroom houses where I would pay that much for, including mortgage, taxes, and homeowner’s insurance. Similar properties here go for $400,000+.) Plus, she currently lives with her sister who constantly complains to her every day… causing her nothing but stress.
I’m not my mother-in-law, who in many ways is a push over, but if I were her I would not tolerate her sister's constantly complaining which puts her under an extreme amount of stress. However, this is a woman who never fell out of love with her ex husband, an alcoholic heroin addict, who smacked her around, even breaking her arm. While she eventually left him, that was because she didn’t want for her children to think that abuse was okay. If it weren't for her children, she would have stayed with him. She said if he promised he’d stay clean, she would have gone back to him… which to me, reflects “push over” mentality. IF it weren’t for her wanting the best for her children, he might have killed her one day. Obviously, being a somewhat naïve, relatively young woman, (she was just 31 when she left her ex-husband), isn’t the only time that she’s been a push over... as is seen by the situation with her sister.
It’s not my place to make such a suggestion, but if I were her, I would give her sister and her sister’s daughter whose living with them notice that she’s no longer going to put up with the constant complaining. IF her sister wants to continue to complain, her and her daughter can find a cheap two-bedroom apartment to move into together. She could even work them with to figure out how to come up with the money to budget a security deposit, out of their own pockets of course, BUT past that they would be on their own.
Not only is this area no longer suitable for my mother-in-law BUT since my boyfriend feels like he’s not connecting with anyone (he hasn’t been around to see me much due to other health issues), it’s detrimental for his mental health. We, also, have an adorable German Shepherd puppy, (I purchased her for my boyfriend’s birthday, thinking that she’d be a good therapy for my boyfriend and could serve as a friend to him during his time of need… she is helping him by exercising constant affection and loyalty), who will be a year old by the time we move, and she deserves a yard. Given these factors, we need to move within a year’s time.
To me, my mother-in-law’s 10% down payment is not so much a handout to me as much as it is a handout to my boyfriend. The average first-time homeowner puts a 6% down payment on their home. I’m putting down 10%, and would work to get that 20%, on my own, if I had the time. Of course, I wouldn’t even need to do that, if my boyfriend was doing as well as me and had money saved up. My boyfriend's mother wants to get out of a bad situation for her, while investing in her son's future so to her its worth it.
As far as the emergency savings, I would like for my brother to put the money that he was saving up for his portion of the down payment in a high yield savings account that my mother-in-law and I both have access to. He was going to lay down the same amount of money on a down payment for a house anyway… While I love my boyfriend, he’s not someone who I can rely on to not start taking money out of the account and put it towards things that we don’t need.
I want to put the mortgage in my name and find a way to put my boyfriend’s name on the deed without his name being on the mortgage. However, my mother-in-law says that my brother-in-law wants for the house to be in his name so that when his son (whose currently a year old) starts school he will get to enroll him in the school that he wants for him to attend. I’m not even sure how that would work because they live in another township… EVEN if he has his name on the deed, to me, he would still be considered a landlord since he and his family would not be living in our house. IF he took the mortgage out as his primary residence, he would be lying and could get into trouble with the mortgage company for fraud. Otherwise, anyone who wants and has the means to buy an investment property, in an area with a school district that they like better, can get a mortgage where he or she states that it is his or her primary residence, and enroll his or her children in the school district there... despite having tenants who live there.
Although I need his help and am worried about sounding ungrateful that he would make such an offer for us, I’m worried about my living situation being governed by my nephew's education. It has nothing to do with my feelings towards his son who I love as though my sister had birthed him, and want to be the ringbearer a my wedding, or not wanting what’s best for him… I do. However, the situation is much more complicated than that.
I plan to be done with graduate school, which could allow me to find a job at an even higher salary, and although I will have student loans that almost equate to my annual wages, I would like to talk to my boyfriend about regularly overpaying the mortgage by 10% a year, if possible, so that we could pay off the mortgage a lot more quickly. IF we succeed in that, then there’s a chance that we could pay off the mortgage in less than 10 years.
At that point, I will be under 40 and I expect for mine and my boyfriend’s wages to be much higher… plus he will have his own children by then. What if we want to rent that place to tenants and move into a second home? I would love for my children to be educated in Princeton, NJ, which is the best school district in the country... BUT very few homeowners who actually think intelligently with their first home, will only own one home.
At that point, our nephew will only be 8 to 10 years old. Does that mean that we should stay there for another 8-10 more years until my nephew graduates from college? If I could rent out that home... it could make up for any deficits in retirement savings that I have, even with paying a property management company. We could, also, work on paying the money that they would give us towards emergency savings back over time.
Also, the agreement was always that once my boyfriend and I paid off the house we would own the home. Should we not focus on paying off the house until our nephew graduates from high school?
Not only that, but because of the housing market, there’s a possibility that we might not even find a suitable fit in the area where my brother-in-law wants us to move to. There’s a high demand and limited supply right now… it’s causing for the prices of homes to skyrocket. IF you go on a real estate website that tracks the value of a home, you will see a huge spike in home prices over the past few months. Case in point, less than a year ago, my childhood home was only worth $369,000, IF my grandmother had made better financial choices... my sister and I would have been able to sell the home for $420,000.
Even if I get the mortgage in both of our names, because my brother-in-law already owns a home… there would be programs that could help me out as a first-time homeowner that I would no longer qualify for, because his name would be on the mortgage.
Am I being unreasonable to my brother-in-law and his wife? I spoke to my sister about this, she says if I need their help at all, even them putting the emergency savings that we would have for the household, I should do it on their terms. However, she knows very little about home ownership… she’s almost 40, and in the place where it doesn’t look like she’s going to ever own a home.
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Your question and your situation are both long and convoluted, and I would recommend that you consult an attorney for advice. It would be worth the fee.
On the surface, however, your "mother in law" has made poor financial choices, her son controls her money, and for both reasons, I see lots of red flags raised, if not for other reasons as well.
Without delving into all the complications, I'd say that in general, you would be far better off steering clear of entanglement and maintaining your own finances, investments, and management.
And I'm laying bets that an attorney would advise you in the same manner. Good luck, Dr. Stephanie
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Whoa there! This is a lot of info but I still have questions. You share plenty info but I doubt anyone on here is a Lawyer by trade. I highly recommend making an appointment with a Lawyer to get the best advice and it should take only one appointment. If you are against seeing a Lawyer, then I guess you may as well continue on.
I am in the mothers age range I would guess (in 60's) so knowing how many things come up as the body wears out, I can hope for a long life but who knows. Counting on his Mom to be around long term is not the best move. Even if she lived til 90, You said Mom couldn't be counted on to spend her own money wisely, so it would seem that other than money, she may have a say in where she lives and who with, but without the flow of the money her other son controls for her, that you have to be planning this all with that son as well. I don't want you to feel I am picking on you but without being married and married because you both are crazy in love together (which there is no evidence of in this in writing so I don't know) I can only suggest as a married couple, getting a house you both can afford along with 'rent' from Mom for a MIL apt in the house. If you can find a place with an already established mother in law apt in the house, she can have the feel of her own place, pay a rent to you both that helps make the difference on your mortgage payment but her other son would need to cooperate on this arrangement and pay her part but she wouldn't own the house. In retirement age group, I don't see the benefits to having a share in a house or owning one outright...but a lawyer could probably help with answering that. I really don't see how this child of his, your nephew even comes into the issue of buying this house. NOt sure I understand fully, but it sounds like brother wants to establish residency in area of college he wants son to go to or maybe also to offer this arrangement so that his now 1 yr old has a place to live in the future because rents and mortgages will be higher. That is a kind thought but how can he know what his son will want once he is older. He may not want to go to that University. And as an adult, he can't be forced to go. He may find a wife and both want to move across the country for the perfect jobs and then he will have no interest in owning that home fully or partially. Any deal with this brother of your bf, a father who is trying to kill two or three birds with one stone may not be the best deal. I don't know, but I sure would read up on real estate and home owner ship if you don't care to see a lawyer. His reason for owning a home is beginning to sound more like its for his benefit, but makes it look better by offering for you to own it later, and have Mom further from Aunt and cousins who try to wheedle money out of her.
What I do not know is whether the agreement you speak of is on a legal document that is solid, or just by his word. Word is not enough, even for family. I was executor as appointed by my Mother before she died. And suddenly I was being harrassed by all my sisters and their husbands. They turned nasty in what they accused me of doing wrong and made life a living hell for a while. Yes, family can turn on you and in your case, you are not family by marriage so your paper work needs to be solid, so that you don't lose out because of some loop hole.
What I am curious about is why if considering getting a house together, that you are not yet married to the bf. I am not legally married on paper with my new husband, but he is not a bf, he is a husband to me. Plus we're senior citizens. So when in your age range, most people want a mate who is their lover and also will make a good father. The focus here is all on obtaining a house and not the feasibility of who will be living in it. You may end up with a house, but a house can't be a home if the people you live in it with don't treat you well and contribute more than their fair share to taking care of you, kids that may come and upkeep of the home.
I also believe you'd feel heart broken to spend many years paying into a mortgage, as you might believe but there is no clear wording in paperwork so that you end up as having been a renter paying rent only. Protect yourself and talk to a lawyer please!
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