Question:
What are the options in the following situation:
Dad dies and the estate is left with an outstanding mortgage on a building that has 2 children living in 2 of the 3 apartments. They both want to stay, what happens with the mortgage? Only one child might be interested in continuing to pay the mortgage. Is that even possible? Can the mortgage be transferred to the interested child or does the dwelling need to be formally sold publicly first? Who decides the sale price?
Answer:
The lender would probably not allow for a straight assumption, the buyer would have to qualify for a new loan.
The sale price would be determined by the buyer and seller. If you can’t agree there is no sale.
Everyone needs to decide what they would be willing to buy it for and what each of them would be willing to sell it for. If you are not sure what you would sell it for, you could get an appraisal, realize that it is not going to sell at appraised value, especially not in this market. You could put it on the market and see what offers you get, and then if anyone wants to buy at that price they can.
The one that does not want to buy should get ready to move or negotiate a fair rent to stay in it.
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