Expert: Jessica Bryan - 9/3/2009

Question
My husband and I are not sure what to do.  We are first time home buyers in Nebraska and would like some advice.  We are thinking about purchasing my mom's house for $120,000.  What is a little less than what it is appraised at (also will be getting new siding and shingles because of a hell storm, which is covered by her insurance).  She would also be paying closing costs.  We know that since she is considered a close relative that we would not qualify for the tax credit.  We like my mom's home because it is fairly new and my husband really wants at least a 3 car garage to restore his car in.  My mom's house happens to be a 4 car garage and to find a house with that large of a garage at that price is pretty difficult.  The houses that we had been looking at were around $160,000 and we really haven't found anything we have been too impressed with besides the brand new homes which are around $175,000 then you figure in the cost to plant grass and all the other expenses with a new house.  Our realtor we have been working with keeps saying don't throw away $8,000.  But we are kind of looking at it as saving $40,000 or more vs $8,000.  Are we correct here or is he right?  Maybe we should take advantage of that $8,000 while we can?  I know the decsion is all ours but we'd just like some advice.  Thank you so much!

Answer
Dear Dawn;
There are plenty of reasons to ignore the $8,000 rebate if you can get a better deal.  It sounds like that is exactly what you are getting by purchasing your mother's house.  You are saving a whole lot more than the $8,000 and getting exactly what you want and need.  It is impossible to find a home (at least not around here) with a four car garage in that price range.  Furthermore, when you want to sell the home later, you can feature the third and fourth bay of the garage as a potential room addition if the new buyers don't want such a large garage.  Plenty of people love to convert excess garage space to family rooms or additional bedrooms. What a bonus!

Regards,
Jessica Bryan