Nephew's aunt requires home sale to pay expenses

Posted8/21/2020 7:01 AM

Q. My aunt has been admitted to a nursing home and it is unlikely she will ever be leaving. She has no children, brothers or sisters and my uncle died years ago. I am her closest and pretty much only relative. We need to sell her house to pay for expenses. She has dementia though at times I can conduct a short, lucid conversation with her. How can I go about selling her house and assist her with her expenses? Things are getting worse quickly and I'm afraid in a very short period of time she will not be very responsive.

A. The easy answer is to have your aunt execute a power of attorney, granting you (presuming you are over 18 years of age) the right to act on her behalf.


It would be a good idea to also have her execute a health care power of attorney, which would allow you to make medical decisions on her behalf. With a properly executed power of attorney, you could do all that was required to sell the property, such as enter into a listing agreement, sign a contract and execute closing documents.

One very important note, however; your aunt must be mentally capable to understand the document(s) she is signing at the time the power of attorney is executed. If she cannot understand the ramifications of executing the power of attorney, she is not legally capable of granting these powers to you.

In this event, you will likely be required to petition the court to become the guardian of your aunt's estate (and maybe your aunt, herself). This is far more complicated, expensive and time consuming than executing a power of attorney. The petition would be filed in the circuit court of the county in which your aunt resides. Once you are appointed guardian of her estate, you would generally have the power to conduct any business she could do if capable, including sell the house.

I strongly suggest you speak to an attorney familiar with this area of the law prior to proceeding. He or she will be able to direct you to the best course of action.

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Q. My tenant of a number of years now wishes to purchase the house he has been renting. I am agreeable to this and we have mostly agreed on terms. One issue holding us up is financing.

He will not be able to get conventional financing for another couple years due to a bankruptcy. I am fine with financing this for two years, but we disagree on how this should be done. He wants me to sell him the property, put the property in his name and I take back a mortgage for what is owed. He will agree to include language that the note must be paid off within 2½ years.

I am concerned with putting the property in his name when he has so little invested (he is putting up only $5,000). Is there another way of doing this where I keep the property in my name until I am paid in full?

A. Yes. This is known as an installment contract or articles of agreement. Your tenant puts down $5,000 and the balance is paid in monthly installments based upon an agreed interest rate and amortization period. In most cases, the tenant would also pay the expenses associated with the property, such as real estate taxes and insurance. The agreement would provide that the tenant will pay the balance due within a certain period of time. In the event he or she cannot or will not timely make the final payment, there is a procedure available to terminate the agreement and recover the property. This procedure, by the way, is far simpler and generally less time consuming than foreclosure, which is what you would be relegated to if title is transferred to your tenant.

Contact a real estate attorney for further details and assistance.

• Send your questions to attorney Tom Resnick, 910 E. Oak St., Lake in the Hills, IL 60156, by email to or call (847) 359-8983.

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