Expert: Dick Dennis - 9/28/2005

Question
my parents were approached by the catholic diocese to sell there propery to them,,the agreement would be they purchase the property and parents live rent free until they die..no existing mortgage on the house and no payoffs due..Is this a good deal

Answer
I would have to know how old your parents are. The idea is to know how long they expect to live. For example, if they are in their 60s, you would have to check the market for rent on the property, total it all up for, say, 25 years and see if that figure equals or exceeds the present value of the property.

If they are in their 90s, the church is not being honest with your parents. Someone should negotiate a transaction that would help your parents while they live in their home.

What the church is going to do is give your parents a "life estate." That means exactly what you said: they get to live there at no cost. But I believe the church should also arrange for the maintenance of the property. And a some living money, depending on their age how much.

If they are both over 62, they could get a REVERSE MORTGAGE and they would get a very decent income EVERY month and never have to worry about rent or payments, but they would have to pay property taxes and insurance.

Get back to me with the added information and perhaps I can give you a better idea what should be done.

I wish you well, Cindy

Dick Dennis      dixiedee13@aol.com