Buyers don't have legal right to know why a property is for sale

Many home sellers and their agents won't divulge the reason why a home is put on the market, in part because it might hurt their negotiating power.

Q. I recently toured a really great house that is for sale at a very good price. The listing sales agent seemed quite nice, until I asked her why the sellers would want to sell at such a big discount. She immediately got kind of nasty and said she couldn't divulge the information based on "confidentiality concerns." What gives? Don't I have the right to know why the property is on the market?

A. No, you're not entitled to know why the sellers are moving or the reason why they apparently set their offering price so low. You certainly can pose those questions to both the agent and the homeowners themselves, but they aren't legally obligated to answer.

Sellers often are reluctant to discuss why they're moving. Some simply want to protect their privacy. Others worry that answers such as "My spouse is being transferred," "We're getting divorced" or "We've made an offer on another house" may suggest to a prospective buyer that the sellers are desperate and may be willing to make deep concessions in order to close a deal.

Most real estate agents won't divulge such information, either, in part because it could give a buyer an unfair advantage in the negotiation process or perhaps even invite an invasion-of-privacy lawsuit from the seller.

Q. Our son is in his early 20s. He borrowed a total of $21,000 from us two years ago so he could finish his college education, and has been paying the money back in monthly installments. Because he does not have a very long credit history, would it be possible for us to report his good payment record to the credit bureaus so he can build his score and improve his chances of eventually getting a mortgage to purchase a first home?

A. It's not impossible for you to report your son's steady payment record to the bureaus, but it would be extremely difficult. That's because the federal government and bureaus alike have strict rules that a creditor - whether it's a huge bank or an individual lender like you - must follow to be part of the nation's vast credit-reporting system.

For starters, the federal Fair Credit Reporting Act requires creditors to post regular updates about a borrower's payment activity. This means you would not only have to keep the bureaus abreast of your son's on-time payments, but also would need to notify them if he's late or pays off the loan. Detailed records, which would be subject to inspection by government regulators, would need to be kept, and you could be fined if the paperwork wasn't in order.

Bureaus themselves don't make it easy for parents or other small-time lenders to report a borrower's activity, either. Most require that the regular updates be sent over secured telephone or computer lines, or transferred via specialized discs or tapes, and you likely would have to pay part or all of the expensive hardware and software costs. You also may be charged ongoing "subscriber fees" that easily could exceed the amount of money you collect from your son each month.

Though it probably isn't financially or logistically feasible for you to personally report your son's payments to a credit bureau to help boost his score, he can take some steps by himself to build his own credit history. One key would be to continue making timely payments on loans or credit cards that he may already have with big banks or other institutional lenders: If he doesn't have one yet, he could apply for a loan or card with a relatively low credit amount, make a few charges, and pay most or all of the outstanding balance at the end of each monthly statement period.

Also, because your son has been making prompt monthly payments on the personal loan you gave him two years ago, you might want to consider the idea of cosigning for a loan on a house that he may eventually want to buy in the future. Your son appears able to handle his debt responsibly, and your co-signature would help him get a mortgage, though the bank could force you to make the monthly payments if your son cannot.

Q. Both of my parents passed away late last year and their will left their home to me, their only child. My wife and I moved into the home and have continued making the mortgage payments. Can the bank force us to pay the loan off in a lump sum because my parents have died, even though they left the home to me? Can I have title to the property automatically transferred into my name and my wife's name?

A. There's some good news and some bad news here. First, the good: Because you are the direct offspring and appear to be the rightful heir to the home, the bank probably cannot force you to pay the mortgage off in a lump sum as long as you remain in the property and continue making the payments on a timely basis. If the lender says otherwise, contact a good attorney for help.

Now, the bad news: You likely will need to hire an attorney anyway, because the will automatically must go to probate court so a judge can rule on its validity and settle any outstanding claims against your late parents' estate. In some parts of the nation, the probate process easily can take one or even two years.

The judge will transfer title to the home to you as "sole heir" after probate is completed, at which time you can then ask the bank to change the name on the mortgage to yours. Completion of the probate also will give you the power to sign a quitclaim deed that gives a partial interest in the property to your spouse, if you still want to do so.

• For the booklet "Straight Talk About Living Trusts," send $4 and a self-addressed, stamped envelope to David Myers/Trust, P.O. Box 2960, Culver City, CA 90231-2960.

© 2010, Cowles Syndicate Inc.