Family cottage creates problems
Q. My mother gave the family cottage to my two sisters and I. Since 2008, I've wanted them to buy me out.
Now they don't talk to me. I've sent certified return receipt letters to them but they are not responding. My sister always sends me a copy of the tax bill without a note or any kind of communication. I send her my third each time.
I don't want to have to pay a lawyer thousands of dollars when I would probably only end up with $30,000. The property is not worth what it was back then. Is there a way that I could resolve this without having to confront them again that won't cost me a lot of money?
A. Many extended families co-own vacation property and it works out beautifully, but those aren't the ones who write to me. When I get a note that starts "My grandfather's will," I just know what's coming. I'm hearing from one of the cousins - usually the one who lives thousands of miles away from the cottage and never gets to use it.
You can ask a mediator (look in the yellow pages) to try arranging something amicable, but there may be more problems here than just that cottage. At any rate, I'm afraid your legal rights would indeed involve a lawyer, a court, unpleasantness and possibly a sale for less than market value.
As a co-owner, you can force a sale. Unless there happens to be land that can be divided, a court-ordered "partition" involves a public auction of the property and division of the proceeds. It seldom yields as good a price as a sale on the open market.
Maybe a letter from your lawyer, mentioning the possibility, would be enough to bring your sisters around.
Q. I'm 63, married, and own my home in my name only. I'm semiretired on Social Security.
Our goal is to use reverse mortgage money to upkeep our home and pay expenses. I checked into a reverse mortgage two years ago. My lawyer advised against it. He said if either one of us pass, the other will need to move out. Any suggestions for someone we could talk to?
A. That's not quite how a reverse mortgage would work. If you borrowed with one and your wife died, you could stay in the house and continue receiving money, building up a debt against the property. Nothing would be due or payable until you died or moved out.
But if you died first, then yes, the loan would have to be paid off. That's because as the only owner, you'd be the only borrower. In order for the arrangement to continue for your wife, she'd have to be co-owner of the property and co-borrower on the mortgage. And as with anyone else with a reverse mortgage, she'd have to be aged 62 or older in the first place. If she's old enough, it can be done, assuming you want to make her co-owner of your home.
Something to consider: If you have a mortgage now and it's relatively small, the new loan could pay it off. But if it's higher, the figures might not work out.
If you chose the most common arrangement, you could receive payments for life, as long as you wanted to remain in the house. Because you'd be starting at almost the youngest possible age, you might not be offered that large a monthly check.
Where to begin? To find a government-approved counselor near you, look at www.elderlaw.gov. Or as your letter came through the mails, I think you may prefer the phone number, (800) 677-1116. In addition, the AARP has excellent information available through its Reverse Mortgage Education Project, at 601 E Street, NW, Washington, D.C. 20049, (800) 209-8085.
Q. I am a tax/accounting professional and am thinking of building an office off the side of my garage. It will be an unattached structure, about 200 square feet and will match the garage. I have checked with the town and it is allowed under the zoning laws. I was wondering how this will affect the property value and if it will be a problem when it comes time to sell.
A. I don't know why you think this might be a problem, but of course I don't know what your neighborhood looks like. Do tell me more about why you hesitate - I'm curious. It's true, of course, that if you improve your property so that it becomes the most expensive on the street, you aren't likely to recoup the cost of the new construction.
As a tax professional, you must know some local real estate brokers. They know your area, and they can give you better opinions than I can.
• 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.
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