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posted: 7/28/2012 4:07 AM

Hire one broker for multiple houses

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Q. I'm getting ready to sell my father's house, and we want to sell our own home pretty soon also. Would you recommend using the same broker on both of them? Or should I sell one first and see how they do with it?

A. Ask several brokers to come over and talk to you about your house. List with the one who inspires the most confidence, and then use that agent for the other house also. Once you have found someone you're comfortable with, stick with him or her for both transactions. You're heading into a couple of stressful situations, and the fewer people you need to deal with, the easier it will be.

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Q. I had to refinance after my husband died in 2008. I have four children, and three are married. I'm wondering if I should sign over the house to my children in case something happens to me and I need to go into a nursing home. My lawyer said no, because if any of my children divorce, there might be a problem with a spouse trying to claim their share. Can you advise me?

A. What I can do is point out a few more drawbacks. First off, qualifying for Medicaid (welfare) on health costs would work only after five years had passed. Before that, Medicaid has a five-year "lookback" provision on any asset you transfer.

In addition to possible complications if one of your kids' marriages goes bad, what if one of them has a lawsuit or back income tax bill that ends with a lien placed against all his or her real estate? Or what if one of them dies, leaving everything to a spouse?

Then again, if you should decide to sell sometime in the future, your kids could owe capital gains tax on any profit, which would be figured from your cost basis for the property. You could not use the homesellers income tax break because you did not own the house. They could not use it because they didn't live there. In addition, if you ever wanted to place a reverse mortgage, you couldn't do it because you wouldn't own the house. And if your community has any tax break for senior homeowners, you'd lose that also.

Then again, your lender probably has the right to call in your whole loan immediately if there is a change in ownership. These days, banks are pretty busy with other real estate troubles, but the possibility is there. And if you refinanced just four years ago, you probably don't have too much equity to protect anyhow.

Q. We have neglected our house for years but want to sell in the near future. The garage doors and deck are rotten, my wife ripped up the old carpets and we have bare plywood as most floors. We need siding and windows, paint in all rooms, and the baths are 30 years old with some floor damage from plumbing leaks.

My wife, who sees the work as too daunting to start, called one agent, who has not seen the house, about selling it as is as a fixer upper. She was told our net as a fixer-upper would be about the same as a normal sale minus repair costs, but we would likely take longer to find the right buyer. We will retire soon, and waiting five years to sell is an issue.

We are in a great location, and the house itself would appeal to many people. I estimate $50,000 to $70,000 for the work if we do some ourselves. We have the money for the work -- it's the size of the task that's the issue.

In general, is the net for selling as a serious fixer-upper approximately what one might net after repairs?

A. Call at least three other brokers, and get opinions after they've actually come to see the house. I'll be interested in what they have to say. I haven't seen your property, but my guess is that your estimate for repairs is low. Those things always cost more than one had planned, and -- this is yet another consideration -- they always take longer than expected.

You won't need five years to find a fixer-upper investor if you price your property sensibly. It's always possible, though, that a buyer's mortgage lender would require certain repairs anyhow. Again, I can't judge from here, but that's another thing to discuss with the brokers who visit your home.

My sympathy is with your wife. You have to put some dollar value on not having the wear and tear you'd endure during a renovation. I hope those brokers will say an as-is sale is perfectly possible. You can judge better after you hear their opinions.

• Edith Lank will respond to questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (include a stamped return envelope), or readers may email her through askedith.com.

2012, Creators Syndicate Inc.

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