Ask the Attorney: Should I use a joint tenancy to avoid probate?

My husband and I own some hunting land up north Minnesota as joint tenants.  After his passing, I became the sole owner.  I am thinking about adding my sons to the deed so we would all be joint tenants. I heard this will avoid probate when I die.  Is a joint tenancy a good idea?

If your only concern is avoiding probate, transferring the property to a joint tenancy with your sons will accomplish this and is a commonly-used tool, but there may be a better way to accomplish the same result.

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Reader Question: Can I purchase a business using a contract for deed?

One of the recent searches that led to the Bloomgren Hanson website asked the question, “Can I purchase a business using a contract for deed?” The searcher didn’t find their answer here (until now). The simple answer to the question is no, but that doesn’t mean you cannot accomplish the same result using different tools.

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How To Cancel a Contract for Deed

A contract for deed is a form of seller financing where the seller sells real property in exchange for installment payments over time.  In Minnesota, contract for deed transactions are governed by a statutory framework transferring all but an equitable interest in property to the buyer.  The buyer is responsible for all aspects of the home (taxes and insurance), repairs, etc. after the contract for deed is signed and filed with the appropriate county office.  The buyer usually pays the seller in monthly installments over a number of years and only receives their deed upon full payment of the contact. For more details on contract for deed options, see here. One of the most common questions our office sees regarding contracts for deed, is what happens if the buyer gets behind on payments.

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What to Consider when Buying Into a Homeowner’s Association.

Homeowner's AssociationIn law school they teach students to think of property ownership as a “bundle of sticks.”  A weird metaphor, but one that makes sense after a bit of thought.  When pioneers “staked a claim” to land, in theory they claimed all of the land between their stakes from the sky to the center of the earth and every right to do what they wanted with the land.  Over time, we have exchanged certain property rights (sticks) for other conveniences.  For example, by purchasing land in a city you might be giving up the right to let your grass grow long, to have loud parties, and to keep vehicles in your yard in exchange for the sidewalks to be paved and to hook up to city water and sewage.  You therefore, have fewer sticks in your bundle of property ownership.

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Contracts for Deed: Not Your Typical Rent to Own

Folks regularly think they want to enter into a “rent to own” agreement when what they are more appropriately looking for is a contract for deed.  A rent to own agreement is basically a lease where the payments are applied to a reduction in purchase price on an option to buy real estate in the future.  A contract for deed is an actual transfer of property, where the contract for deed seller (or vendor) transfers almost all of his property rights to the purchaser (or vendee). It is an excellent option for both buyers and sellers who choose seller financing.  The statutory rules for contracts for deed in Minnesota can protect both the seller and purchaser.

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Are you “cra-zay” to consider seller financing to get your home sold?

In the current hey day of tightened lending standards, parties to real estate transactions are becoming increasingly clever in trying to close real estate transactions. More often I am working with sellers who are being asked to and who are also willing to back a percentage (some times a large percentage) of the purchase price. Are they cra-zay? Continue reading “Are you “cra-zay” to consider seller financing to get your home sold?”

Home Owners Associations: Getting Paid During Foreclosure

When a home falls into foreclosure, quite often the homeowner quits paying home owner’s association (HOA) dues long before a bank takes over the property and long before a new owner resumes paying regular monthly dues.   What happens to the obligation to pay HOA dues when a home is foreclosed?

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Basics of Property Ownership Between Spouses

So many folks who I work with on real property (land) matters have at least some confusion about how property ownership generally works, especially between spouses.  Here are some of the issues I see the most often and a basic explanation of the law related to each instance: Continue reading “Basics of Property Ownership Between Spouses”

How to Deal with Unpaid Home Owners Association Assessments.

Many small to mid-size home owners associations (“HOAs”) are run by a board made of a few active members. It can be a thankless job, especially when the HOA cannot afford to pay an outside management company to be responsible for the day-to-day management of the HOA. The question that always arises is how to handle the member that has stopped paying assessment dues. In a small HOA, delinquency of even a few hundred dollars can be a large percentage of the HOA’s budget. Here are my tips on how to handle delinquent members.

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The morality of walking away from your home.

For over a year I’ve been providing clients an hour long “primer” on foreclosure and the risks in walking away from a home that is underwater. What strikes me in almost every case is the client’s strong sense of ethics/values/morals surrounding homeownership and ability/obligation to pay. Brent White, a University of Airzona law professor has written a book called Underwater Home: What Should You Do if You Owe More on Your Home than It’s Worth? which lays out the case for and against walking away from an upside-down mortgage where the home is worth less than the mortgage balance. Mr. White strips away the moral issues embroiled in the decision to keep paying on a home that you can’t afford. Mr. White states:

I think it‘s OK to stop paying the mortgage long before you clean out your savings, sacrifice your retirement, spend your children‘s college fund, and certainly before you have to start using your credit cards to survive. Before you do any of those things, I think the more moral course is to stop paying your mortgage. Indeed, I think it‘s morally acceptable to default if your mortgage threatens your ability to save adequately for the future, regardless of whether you can pay it according to some arbitrary definition of “affordability.” It may be more responsible to put the money saved from giving up your home and renting instead into an investment account, so that you are secure in retirement. Or put it into a college fund, so that you can give your children a chance at a higher education.

Certainly food for thought.

Read more: Walking Away From Your Home, for Dummies? – Personal Finance – Real Estate –