real estate conundrum

[elchivito]

Father in law passed away intestate and suddenly two weeks ago. He and I were close friends. Left a house with a mortgage in need of significant repairs to make it salable or rentable. House is 2 hours away in a college town. My wife and her brother are not on the deed or the loan. She talked to the bank and of course they encouraged her to try and sell it.
Had a RE agent friend up there run some numbers and she says if we could find a quick buyer who would take it as is we might come out 6-8K clear after everything's paid off. Trouble is, AZ has a mechanism, paperwork petition thing for next of kin to apply to transfer title to their name but it takes 6 months for approval minimum. Meanwhile the mortgage has to be paid. There goes the in my opinion VERY optimistic 6-8K cash-out.
Another RE friend last night suggested renting it during that period but in the shape it's in right now I'm afraid we'd only be able to rent it to a bunch of college kids or tweekers. Who needs that aggravation?
Not my decision and we're not on the hook for anything but I'm seriously hoping she decides to just hand the keys back to the bank and be done with it.

[kerry]

Have an acquaintance who only rents to college students in Ft. Collins. Has no complaints. Or, rent at a reduced rate to a handyman willing to do repairs.

[engatwork]

Handing keys to bank sounds like the best deal to me. It is going to be a pia to deal with it seeing as how it is 2 hours away.

[JB3]

House with paying college students in it is better than an empty house deteriorating and costing the same in taxes and mortgage. It can easily be sold occupied as well.

Also occupied makes insurance giddy.

My suggesting is rent it out, use a management company to do so and maintain the property. In the meantime work out the paperwork process and ultimately sell it. That can take so long you are much better off with a rented building.

I went through this with an inherited house and it took nearly 2 years to settle the estate and sell the property. A house sitting empty all that time is a house falling to pieces and dropping in value

[t walgamuth]

Tough call. It sounds like some work to accomplish a small income, and really only you can decide what to do with it. I like being a landlord but having property all within a five minute drive of my home is a key to my peace of mind.

[elchivito]

My wife is still grieving her father and ultimately she'll have the final say. Seeing the complexity of the deal and the small potential return I don't think she's going to be inclined to try and hold onto it for a sale.
We've rented out a few houses here locally and held them until suitable buyers come along. Still carrying paper on a couple of them. I can't say I enjoyed being a landlord even when the properties were close by.
We'll see. Thanks for the perspective.

[barry12345]

You might consider an agreement of sale deal. If it does not work out I think nothing is lost as you just walk away as well and the property just reverts to the mortgage holders. It sounds like it is on the verge of it anyways. I assume such agreements are used occasionally in your jurisdiction? This is only practical at best if the existing mortgage can be left in the estates name. The property title has to also almost remain in the estate until the place is finally paid for. I am not familiar enough with your local laws to know what is even possible there.

I have used them with no difficulty but just lucky I suppose. We currently have a surplus place that has no mortgage and will probably be sold that way. It too needs work. We just want it gone.

From my perspective and experience many people of modest means that have always been good tenants of others can actually handle a reasonably priced house that needs some elbow grease. Yet cannot qualify for a conventional mortgage. It is just one thing on a long list I have to deal with this summer.

It is really impractical to be a landlord here now with the provincial tenancy board. It is one of those common deals that you give them a little power and they have expanded it to insane levels as far as rental owners go. Too many tenants today will just abuse their rights to avoid paying rent. This board since existing has made me dead set against being a landlord.

[Simpler=Better]

Rent to engineering students-they will fix stuff when it breaks, and *probably* won't burn it down. I was all over cheap rent in houses that needed repairs when I was in school.