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CoronitaParticipant[quote=SK in CV]BG, this sounds like horrible divorce representation. Under the scenario you described, absent a specific waiver of reimbursement, the value of the home contributed to the community would be reimbursable to the contributing spouse, irrespective of how the home was transferred to the community.
These kinds of problems would be easily avoidable in the case of a Roth (or other self-directed retirement plan). Even employer sponsored plan equity is separate property, to the extent it was earned prior to marriage.[/quote]
I thought that was the case, but wasn’t sure…I guess I’ll talk to an estate attorney as well as a CPA when I get around to it 🙂 I’m just looking for preliminary information (brainstorming if you may call it). The actual technical details, I’ll discuss with a paid pro(s)…
Merci!
CoronitaParticipant[quote=CA renter][quote=flu][quote=CA renter][quote=flu][quote=CA renter]If the appraisal came in low, use it to your advantage. Tell the seller than you can only pay the appraised amount. See if they reduce it all the way, or part of the way.
Good luck![/quote]
In this market? ha ha ha ha. If I were the seller, I’d say… See ya, next buyer.[/quote]
Sure, if there are cash buyers or buyers with extra cash over the 20% who are willing to pay an inflated price. I’d still take my chances as a buyer to negotiate. IIRC, if they show the appraisal to the listing agent/seller, it’s supposed to be included as part of the disclosure package. SDR, please correct me if I’m wrong on this.[/quote]
With the way lending requirements are these days, provided the person can qualify for the loan, I’d take the one(s) that gave me the higher offer, who had more than 20% down, but I wouldn’t require them to pay 100% cash, especially if the house is over $1million. I think it would depend on how much activity there is in that area. If there has been many sales nearby of comparable, then the that might be a red flag. But if the sales history in that area has been spotty, and especially if the appraiser isn’t from san diego, that might have a lot to do with it. I don’t follow what you said about “the 20% who are willing to pay an inflated price”. I’m not sure where you got 20% from. And as far as inflated price. One can determine if the price is inflated if there is a reasonable comparable.[/quote]
Whoops! Sorry about the totally horrible syntax there, as I was posting in a hurry.
What I meant was that the seller could sell to all-cash buyers if the house is in an area that attracts these types of buyers, or simply to someone who is willing to fork over additional money that exceeds the 20% down payment, like Essbee did. A mortgage company won’t usually increase the amount they’re willing to lend beyond 80% of the appraised value if it’s a conforming loan, so the buyer has to increase the amount of cash they’re willing to contribute above the 20% down payment.
In our case, the appraisal came in low; and even though we were all-cash buyers, we still insisted on purchasing at the lower, appraised price. We offered to pay for the seller to hire their own appraiser to see if they could get a different number, but they weren’t able to find any comps that would justify their higher list price. In the end, we paid the appraised price plus $10K toward our agent’s commission. We also let them forgo a lot of the repairs that they would have had to do for buyers who were using a mortgage (required termite work for mortgaged properties) which saved them thousands of dollars. The appraisal came in $50K below the list price.
The appraisal also noted that the market was declining, so even though they wanted to test the market some more, they knew that they had a solid buyer who could close in a matter of days, so we got the house.[/quote]
i think though the difference between when you bought and now is back when you bought the housing market was cold. Many people couldn’t either qualify to buy or weren’t in the buying mood. You idea of asking for the seller to reduce a price really only works if it’s a buyer’s market and if you have other homes you are interested in and don’t really mind walking away.
Today, it’s a sellers market. These days, for a good home, more than enough, the choices are (1) buy the home or (2) walk and let someone else buy it and wait to find something better (perhaps wait a long time).
Asking him/her/them to reduce the price significantly due to an appraisal imho is unreasonable, if he had other offers and if the home went pending really fast. That to me tells the seller priced his/her home fairly given current market conditions. If the home has been sitting on the market for ages, then maybe there’s wiggle room there. But if the home went on the market and then went pending a week or less, then like I said…good luck renegotiating with the seller. I wouldn’t.
CoronitaParticipant[quote=SK in CV][quote=flu][quote=SK in CV]It’s a great idea. Almost no downside. If I had lots of extra money and my kids didn’t need today what little I do give them, I’d do it in a heartbeat. My brother (a managing director at a national tax and consulting firm) who does have plenty extra and doesn’t need to worry about his own retirement, has been doing it for his two daughters for more than a decade.[/quote]
I was hoping you would chime in on this. Thank you.
Now the bigger issue is that I need to figure out. How do I give my kid a “job” at this age…lol….You said “almost no downside…”
Ok, almost… What are the downsides in your opinion…..[/quote]
The accounts belong to the kids. If they’re over 18, they don’t need your permission to take the money out. We always hope our kids are going to act responsibly, but we never know for sure. Other than that possibility, I can’t think of any downside.[/quote]
IF it’s the same rules as for UTMA, then I think in CA the age is 21. I guess the difference is that for a UTMA/UGMA, until that age, I think technically youcan withdraw from that account, as long as that withdraw is “for their benefit”. So if your kid is out of control at age 20, you have that option. I guess for the roth, that wouldn’t be possible, at least for the earnings portion without paying the penalty.
CoronitaParticipant[quote=SK in CV]It’s a great idea. Almost no downside. If I had lots of extra money and my kids didn’t need today what little I do give them, I’d do it in a heartbeat. My brother (a managing director at a national tax and consulting firm) who does have plenty extra and doesn’t need to worry about his own retirement, has been doing it for his two daughters for more than a decade.[/quote]
I was hoping you would chime in on this. Thank you.
Now the bigger issue is that I need to figure out. How do I give my kid a “job” at this age…lol….You said “almost no downside…”
Ok, almost… What are the downsides in your opinion…..
CoronitaParticipant[quote=CA renter][quote=flu][quote=CA renter]If the appraisal came in low, use it to your advantage. Tell the seller than you can only pay the appraised amount. See if they reduce it all the way, or part of the way.
Good luck![/quote]
In this market? ha ha ha ha. If I were the seller, I’d say… See ya, next buyer.[/quote]
Sure, if there are cash buyers or buyers with extra cash over the 20% who are willing to pay an inflated price. I’d still take my chances as a buyer to negotiate. IIRC, if they show the appraisal to the listing agent/seller, it’s supposed to be included as part of the disclosure package. SDR, please correct me if I’m wrong on this.[/quote]
With the way lending requirements are these days, provided the person can qualify for the loan, I’d take the one(s) that gave me the higher offer, who had more than 20% down, but I wouldn’t require them to pay 100% cash, especially if the house is over $1million. I think it would depend on how much activity there is in that area. If there has been many sales nearby of comparable, then the that might be a red flag. But if the sales history in that area has been spotty, and especially if the appraiser isn’t from san diego, that might have a lot to do with it. I don’t follow what you said about “the 20% who are willing to pay an inflated price”. I’m not sure where you got 20% from. And as far as inflated price. One can determine if the price is inflated if there is a reasonable comparable.
CoronitaParticipant[quote=flyer]ahh–skiing and snowboarding–+1–way more fun than golf:)[/quote]
Autocrossing and HPDE event > skiing and snowboarding
CoronitaParticipant[quote=FlyerInHi]Flu, good point. But the ivy leaguers of today are different. They are not the same country club ivy leaguers of years past although that culture is still alive and well.[/quote]
Uh, no… Depends on which country club you want to associate with. The ones with money and an MBA? Tend towards golf….
CoronitaParticipant[quote=FlyerInHi][quote=poorgradstudent]Golf is dying a slow death. It’s viewed as too elitist and boring by the young and middle class and seems to be waning in popularity among the elite. I’m not sure many business deals are hammered out over a round of 18 (or even 9) anymore.
Maybe Golf just needs another Tiger to come along. The fact he’s still the biggest name pro despite being terrible thanks to injuries for years says something.
The industry probably just needs to consolidate. Thirty years ago there were a lot more bowling alleys. Bowling still exists, but San Diego county has what… two real bowling alleys plus one hipster bar with a couple lanes? There’s probably just too many courses compared to exisiting and projected future demand right now.[/quote]
I learned golfing. Bought all my equipment, etc… Then I gave it up because it’s so boring.
I once wanted to live on a golf course. I’ve totally changed.[/quote]
You do realize golfing is very popular among ivy league graduates… 🙂
CoronitaParticipantIssues/Drawbacks:
* Money will be tied up for long time with a stiff tax penalty for early withdraw on earnings…except withdraw for qualified expenses for education, first home purchase, and hardship withdraw.
* This would probably mess up financial aid, but it’s a moot point for those of us that weren’t going to quality for this anyway.
* Your kid needs to earn an income to be able to contribute to a Roth. What you can contribute is limited to what they earn that year or $5500, whichever is lower.
* I don’t know what the tax implications would be if your kid unexpectedly passes away early (hope that doesn’t happen)
* Uncle sam can change the tax laws
* Marriage. Can this remain separate property?
CoronitaParticipant[quote=CA renter]If the appraisal came in low, use it to your advantage. Tell the seller than you can only pay the appraised amount. See if they reduce it all the way, or part of the way.
Good luck![/quote]
In this market? ha ha ha ha. If I were the seller, I’d say… See ya, next buyer.
CoronitaParticipantI’d say it will be sold to some investment group from asia pac.
CoronitaParticipantIll be too old enough to care next time. I intend to enjoy things while I’m still young(er), though 40ish is pretty old these days.
CoronitaParticipantIt depends on a lot of things. If you happen to be buying in an area which doesn’t have much turnover in sales, it might be hard for an appraiser to find a real comparable. So that might give a much lower appraised value. Some people also end up working with an appraiser out of the area. And that appraiser might be clueless. That happened with one of my refinances. It depends. So many variables.
April 20, 2015 at 5:55 AM in reply to: The cost of an Ivy League undergrad degree next year…. #784998CoronitaParticipant.
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