Buying your parents a house...
 

What would you do if your parents approached you, after you had just started doing decently well financially asking you to purchase a home for them? You would pay the entire principle/interest/taxes while they would just pay the upkeep.

Just want to make sure if my reaction was justified...

Edit: I already pay for a car for my mom, which is a lease payment/money down on a Hyundai.

How old are they?

Jeff

Both are 59, and unfortunately have made some unwise financial decisions in the past.

I was livid.:mad0259:

Depends. Can you afford it? Argument goes two ways. They did raise you but at the same time if you can't afford it they can't expect you to do it


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Hm... it's pretty hard. All depends on the financial situation. If I'm well off, I might consider it... BUT they still gotta convince me A LOT.

I fortunately am in a position where I could afford it. I just am having trouble justifying a sensible reaction to this "charity."

I guess it's better than their first alternative, which was asking to move into my 2 bedroom townhouse with me (out of the question).

As most mentioned, it depends on how much you can afford. They are your blood and they did raise you right (we hope) so it wouldn't be right to not help them out.

On the flipside, since you mentioned they made some bad financial mistakes, it could turn ugly with you on the loan. Since it's only them and they are 59, why not a small, house, condo or townhouse and just give them enough for the down payment so you wouldn't jeopardize your credit.

So many factors play into this. I doubt there are two families in this world that are the same. In my case I came from a dysfunctional home and I wouldn't do it. That doesn't mean it wouldn't be right for someone else.

Unfortunately the area that they need to buy in, due to my older sister being mentally handicapped and soon to be placed in a group home, is very expensive. A 2 bedroom town home can run in excess of 300-500 thousand dollars. A fixer-upper home can be had for this amount too, but they aren't exactly in any shape to do any handiwork.

I see it from this point too. I've worked hard to maintain my excellent credit and am just finally starting to see green from my investments. I just don't feel it's right to be even be burdened with their poor financial decisions.

Maybe I'm just heartless.

So obviously there is a lot more to this an just what you've said..... and your relationship to your parents is a big part, which you haven't described...... but if you can afford it (comfortably) and if it won't become a burden to have two (?) mortgages, why not? They're older and may have made some bad decisions, but if you choose the house wisely, it will just be an investment for you.....

The relationship I have with my parents is both good and bad, just like anyone. But I haven't received any financial support from them since I was 16, where their poor financial decisions caused me to live with my grandparents. It's been better in recent years. I'm 28 now, so those times are long behind.

I could afford two mortgages. Thankfully I qualify for stupid low interest rates.

Unfortunately though I don't see a home as an investment. I had a long explanation of why, but it would be getting a bit off topic.

Apartments out of the question?


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You're not heartless. It's a parents job to take care of their young. On the flip side it's much less natural for the young to take care of their parents. If you were heartless you'd just flat out refused. You're just hesitant for financially back Simeone who hasn't been financially response able


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You could also try offering to take care of the expenses for your sisters group home. That would force them to make financial choices that even if they made bad ones it would not hurt her if you know what I mean.


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This would be a really weird situation to be in... I do however think that the best thing to do something small for them like assist with an apartment deposit or something under their names.

Buying a house? No way... I understand family but money issues rip friends and families apart way too much. So, help them some and then leave it to them to be responsible after being assisted. If they can't be responsible then that is on them and you're not left with dealing with the fallout/aftermath.

It kills me to hear situations like this... People who have made bad choices and are down on their luck always seem to expect complete handouts... Complete handouts do not fix the situation and only leave them waiting for more. They need help so if you're going to do anything then I say help. That's it... Just HELP... They've got to live with their mistakes just as we all have. If they're going to make it better then it is on them to turn it around.

Ok, sorry for the rant... Good luck in deciding what to do though! Like it was stated everyone's situation is different! Here's praying it all works out for the best!

That's not true at all. Many cultures take care of their elderly. I don't know you at all, but that made you seem very intitled.

My mom has made her peace and I have plans in place incase she needs this kind of support, thankfully she doesn't though. My father knows better then to ask. Everyone's situation is different.

Not going to argue but in cultures yes many take care of the elderly. But much less common in nature.


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It's tough man, every scenario is different. Everyone makes mistakes, some more than others. My mother and I have always gotten along and have a great relationship. Recently, my relationship with my father has been pretty sketchy but I still love him and if I can I try to help. At the end of the day they are still your parents, I learned to appreciate my parents once I had my own child.

Gonna quote myself because I really feel this is a good way of showing you do care but also holding them responsible for their actions


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So is your sister and parents going to be in the same home?

I don't mean to cross the racial barrier but are you white/caucasian? I'm only asking because a lot of my Asian friends actually did this for their parents as a gift; Chinese, Filipino and Vietnamese. They helped move them into a nicer home along with the relatives so even though they are old, they'll have family around to help watch and take care of them.

I'd hardly call 59 years old elderly. 65+ yes

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Buy it but keep it in your name and have them pay the yearly taxes. That way you are helping them out but in the end you own property that should at least hold its value.

Ridiculous. Even if I had the money, my mom would never ask for something like this.

You had every right to be livid. I probably would've laughed thinking it was a joke at first.

You should watch ESPN's 30 for 30 "BROKE". I'm all about self-preservation and not giving anyone anything unless they earn it. That is not to say I haven't given material things to family members.

Since your grandparents raised you from 16 on wards, I'd be hesitant to take a financial risk on parents who made poor financial/parental decisions. I'd start with something really small and if they get livid about it because you don't want to buy a house for them. Then that gives you reason to pause (sign) that it's not in the best interest for your financial security.

^this: even tho it's a lot more of a financial burden on you this is the safest way to maintain that clean credit history of yours.


and plus does it have to be that exact area? can't it be the next area over, you did say you bought them a car.

And if they fail to pay the taxes?

I'm white. This really isn't normal among any of my Asian friends even, except those that are first generation Americans. :bonk:

Maybe it's a bit of motherly instinct that I'm even considering it.

FYI: I did laugh a little when my parents brought it up as I thought it was a total joke.

im an asshole. i would be livid and i would say no. but then again i dont have the best relationship with my parents.

+1

.....but only if it puts zero strain on your own financial situation. It need not be anything terribly nice, even if it was, doesn't sound like they'd be terribly grateful anyways. Good luck with the situation.

I would treat it like a business transaction. Buy the house, ask that they pay rent, you maintain deductibility and right to sell. My mother passed at 60 so 59 may not be old, but you never know when your time is up. You are young and it's only money. You can and will make a LOT more money but you can't buy time. I personally would do it, but am 20 years your senior and have a different perspective on the value of money and much different circumstances.

I don't know how I would act/respond to this situation as it just seems so far out there to be relevant to my life, but I would probably see about helping them out a bit, or trying to see what other options were out there.

Perhaps help them rent a different place, or buy a place for them to rent from you for what they can afford. I'm all for helping out family, but it does seem like an odd request.

Jeff

^ +1


Maybe try the renting an apartment idea for the first year and see how that pans out. That would give you a better idea before making a huge financial commitment.

I am fortunate to have awesome parents. My parents have always been there for me. Even when I made a few really bad decisions. I would help them now any way I could.

Some parents don't give their children much training or support. If I was one of those kids, I may not be rushing to help. No judgement. Life is hard.

Hmm that's a tough one.

My brother, sister and myself do help our parents with some expenses as they are both elderly and on limited income (although my mother still works 30-40 hours a week). My father has major back issues which resulted in him becoming disabled from a work perspective so he's retired but always looking for temp/seasonal stuff to help make ends meet (tax stuff mostly, he's a CPA).

They have never asked us to buy them anything major although I have bought my Father a car and plan on buying a car for my Mother next year. Part of that is to eliminate having to fix their older cars, which started to take up a bit of my time.

A house is a major purchase though, I don't believe I'd help with that, nor would I be in the position to without eliminating things in my life that I love doing.

Part of the reason I'm willing to help out is that the only bad financial decision my parents made was my father having too much pride to make us change our lifestyle when he was laid off. We never realized that he used his savings up hoping that things would improve afterwards until it was too late. That decision, while not wise in the end, is at least partly responsible for me being where I am in life now.

IMO I agree with the others, help them with an apartment or other lower cost solution instead of buying a house and see how they handle it. After that you can decide if the business transaction of you buying an investment property (the only way you should look at it IMO) is worth it or not.

That's what I would do. That seems like the most logical way to go about this imo.

My wife and I gave this considerable thought when we were in our early 30's because I was convinced I would end up supporting my parents. Here is what we planned, and I still think it is sound.

First, do not overextend yourself. All of you in a 2 bedroom townhouse is better than all of you living in your FR-S on the street. If you have to take out a loan, all of your real estate loans should not add up to more than 25% to 35% of your annual income.

Be ready for an emergency. You can lose your job/business. When you do, you'll need to be able to make both mortgages.

If the area where they want to live is too expensive, they live somewhere else. That's just the facts of life. I don't live on the Beach because I can't afford it. They don't live in a neighborhood with $500K townhomes if all you can afford is $1000 a month.

Consider paying for a rental first and foremost if you do not want to be a landlord (free or paid). Things will break and they will expect you to fix it.

If you do buy, keep the property in your name and retain ownership of it.

Require them to contribute, but do not expect them to pay any of the associated costs, even though they may truly want to. If they can, great, but don't count on it. If they do give you money use it to pay down the mortgage or put it in the bank for their next financial emergency (there will be one)

If you can get it, you should have enough life insurance (term) to pay off the property when one of them passes.

Just my thoughts. Best of luck to you, its a tough situation and I feel your pain.

Thankfully I own my townhome nearly outright. I've been very lucky in the past year to be able to do this, and a bit of help for my late grandmother. What you mentioned is actually what they suggested, which is to have me buy a home which they will move into with me. This may be somewhat possible as I do travel a lot for work and it wouldn't be too much an issue. Unfortunately an increased home in size also means increased bills, and as it stands right now in spite of them claiming they would help the bills would ultimately fall on me. One of the reasons I do live in a townhome is the decreased bills compared to owning a house and throwing as much money as possible into my own business. This means that putting down any sizable down payment would be out of the question.

I think I'm more likely to assist them with finding rent on a place. Even though I travel a lot, just being in the same place with my parents would add a level of stress in my life which I don't need.

Thank you all for your responses.

^Sounds like you've thought this through a little more and have made your own conclusions. best of luck with everything and we're all here if you need advice on anything else. :thumbsup:

You're a good person glad you've got the ball rolling.


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Some of the comments in this thread amaze me !! seriously.

Never forget that they raised you and how much they would have gone through to give you the best. I know from experience.

The easier solution will be for them to move in with you to lower the financial burden as I understand buying them a house not a feasible option.

FFS.... at the end of the day they are you parents and family is very important