Dear Moneyist,
In 2009, when the property market was crashing, I added both my daughters to the deed of my home so I would not lose home to foreclosure during my divorce and, in case something happened to me, my daughters could keep the home.
It was only to be a temporary fix until I could finally sell home, and both daughters agreed to sign off on the deed. By adding my daughters it allowed me to use her income to qualify for a loan modification. I, not my daughters, made all the payments. Fast forward to 2019.
My eldest daughter had received over $760,000 for the sale of two homes that were given to her by her deceased former mother-in-law. This daughter has always spent her money foolishly, and has terrible credit. Even with all this money, no one would rent to her cause of her terrible credit.
This daughter talked me into renting my home to her for one year, with an option to buy the home after one year. I was able to purchase an RV to travel for a year, then return to sell my home to her. We agreed that I would repay the money she loaned me for the RV from the sale of my home.
When one year had passed my daughter informed me that she would prefer that I keep renting to her, and asked me to take out another loan so I could purchase a home for myself. But this is my home. I have lived there for years. I was not comfortable with her request, so I said no.
My daughter has refused to move out of my home. Her sister quit-claimed her portion of the home back to me as agreed, but my eldest is refusing to do so, and because she is on the deed, I cannot force her out. I am 69 and living in the RV. Can I file a case for elder abuse?
Mary
Dear Mary,
You are opening yourself up to a whole lot of trouble and extra legal costs if you file a case against your daughter for elder abuse. You quit-claimed your home to your daughters before your divorce to shield it from any claims by your then-husband. That would not be looked upon kindly by the court and, your strategy (however flawed) speaks volumes about your cognitive abilities and motivations — if not your judgement — in doing so.
But divorce is stressful and, by going through a divorce in 2009, you effectively had two recessions: one economic recession and one romantic recession. Divorce can cut your net worth by half, and leave many couples faced with the prospect of building their wealth again. Unfortunately, you trusted your daughters to do the right thing, while doing something that was at best ethically questionable. It’s Shakespearean in a Mrs. Lear kind of way.
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If you bought your home before you were married, it was already beyond your husband’s reach. If you did not use marital funds for a renovation or mortgage payments, it would remain separate rather than community property. The rule of thumb, which is sometimes difficult to follow: Never make big financial decisions during a divorce or after a death, or any other big life event and/or always seek (sound) financial advice before doing so.
Your daughter now owns half of your home. You could ask your other daughter to intervene and ask your daughter to honor your agreement. Failing that, you could attempt to take a “partition lawsuit” to remove your daughter’s name from the deed, which would be costly, in order to access your half of the equity. Given the circumstances, you would still have to pay your eldest daughter for her share of the house as she is a legal owner.
Your only other option: move in. After all, it’s your home too.
You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com. Want to read more?Follow Quentin Fottrell on Twitterand read more of his columns here.
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