Expert: Dick Dennis - 2/11/2006

Question
I got my house and 1/2 acre land in my divorce, and it's paid for.  We had gotten the property in a trade with the owner financing the balance.  Later, we attempted a HELOC to use to make badly needed improvements.  Everything went great until the inspection revealed that it was sitting on the ground and wouldn't pass structurally.  

The house is in a fairly good location, with the land values high, zoned residential and commercial with huge trees.  

The house itself needs major repairs.  The main part was a 1 story house built in the 1940's or 50's.  It was added onto several times in a haphazard way so that nearly every wall is a supporting wall. In the 80's the owner built a garage/appt-type 2 story addition with it's own heat pump, hot water heater, electrical and put in a pool.

People often compliment me on the house, it's appealing if you don't look very close, and much of that is because I'm very good at cosmetics. The house has 5 bedrooms and 4 baths - 14 rooms in all.  

The house has so many problems, I don't know where to begin.  It truly is a money pit.  The wiring is old and problematic. The house isn't tight and the central air/heat system is ducted in the attic (it wouldn't fit underneath) so heating is very expensive.  We put in a new gas furnace which I can't afford to run now.  The two electric heat pumps are soon going to need replaced.  The wood siding is in bad shape, my ex painted over the pealing paint and rotted boards so it's looking very shabby now on close inspection.  The roof needed replaced years ago, thankfully I don't have any leeks now, but it's just a matter of time.  The water heater in the addition is leaking.  The small kitchen is horrible, the appliances are completely worn out with the cabinet under the sink rotted out, in fact the kitchen floor rotted out and my ex tacked down a piece of plywood to cover the hole!  We have tile in the foyer/dining room and office, but the rest of the flooring is nasty - 20 year old carpet and cheap stick-on tile.  The pool/patio is in horrible shape because I can't afford to open it or care for it.

I'm in serious financial trouble with 4 children (2 away at college) to care for and bankruptcy from medical bills ahead of me.  The attorney said I could lose the house, although I'm not sure if the court could even sell it, or get enough out of it.  In any case, I can't stay here.  The utility bills and other costs of running this house are eating me alive, and as I said it's time for every major thing to be replaced/repaired.  I'm tired of paying exhorbitant power bills while still freezing and sitting in the dark to keep the costs down.  I've vowed to not spend another winter here - even if I have to lock the doors and move out.  We could be living so much more comfortably in a small renter house - for less!

What can I do?  Assuming I don't lose the house in the bankruptcy, I wondered about trying to owner-finance and offer the house at a great deal so that the buyers could make the needed repairs.  I've also thought about selling some things and trying to raise the money to update the floors and appliances - but I don't know if that investment would even matter if it's not sellable.  I just don't think I have any options.

Answer
Based on what you have said, I might be interested in helping you, Karen. I have seen many of these kind of houses you describe. Takes a lot of money, blood, sweat and tears to make it right.

Where are you located. Allow me to get a better idea of what you have and how I can help. No guarantees. I wish you well.

Dick Dennis
dixiedee13@aol.com