Question about private loan - forcing SIL out of house

[Bobbee47]

Jurisdiction

Texas

Hi, my wife signed on a private loan for her older sister and I'm in the process to MAKE them take over the private loan. In case they don't comply with my demands since that my wife is on the loan and title, can we sell the house? Do we have full rights to kick them out?

duplicate post sorry.

 

[adjusterjack]

If I am understanding correctly that your wife and her sister are both on the deed as owners of the house then, no, you cannot "make" the sister do anything and the sister has as much right to occupy the house as you and your wife do and you cannot sell the house without the sister's consent and signature.

What your wife can do is file a partition action (google it) to force the sale of the house so she and her sister can split the proceeds (if any).

Trouble is, a partition costs lots of money for the lawyer fees and the sale is handled by the court at auction where investors will buy the house for a lot less than it's worth, a price that might not even cover the loan(s) on the house.

Duplicate post. See:

Question about private loan - forcing SIL out of house | | TheLaw.com

 

[Bobbee47]

If I am understanding correctly that your wife and her sister are both on the deed as owners of the house then, no, you cannot "make" the sister do anything and the sister has as much right to occupy the house as you and your wife do and you cannot sell the house without the sister's consent and signature.

What your wife can do is file a partition action (google it) to force the sale of the house so she and her sister can split the proceeds (if any).

Trouble is, a partition costs lots of money for the lawyer fees and the sale is handled by the court at auction where investors will buy the house for a lot less than it's worth, a price that might not even cover the loan(s) on the house.

Actually my wife is the sole borrower and only person on the title. I'm thinking reaching out to the private lenders and have them resale the house if necessary.

I really don't want to escalate the situation but her sister has been sitting on this issue for over a year.

 

[adjusterjack]

Actually my wife is the sole borrower and only person on the title.

Then what does the sister have to do with anything?

Why would you want to MAKE the sister take over the loan?

Why is the sister living in your house?

With what kind of agreement? Tenant? Guest?

Who else is living in your house with you and your wife and the sister? You use the word "they" when referring to the sister.

Why do you want to kick "them" out?

Perhaps a more comprehensive explanation of the situation would elicit more helpful comments.

 

[Bobbee47]

Then what does the sister have to do with anything?

Why would you want to MAKE the sister take over the loan?

Why is the sister living in your house?

With what kind of agreement? Tenant? Guest?

Who else is living in your house with you and your wife and the sister? You use the word "they" when referring to the sister.

Why do you want to kick "them" out?

Perhaps a more comprehensive explanation of the situation would elicit more helpful comments.

It's complicated but here's the breakdown.
Her sister had my wife sign as the sole borrower on the private loan. Not sure why but I'm thinking it's pure "taking advantage" of my wife and wants to live a luxurious life on someone else's credit.

There was no agreement, just that my wife signed for the loan and her sister is to take over/ remove my wife from the loan after 12 months.

No one else beside her sister and her family is living in the house.

I'd rather not kick them out but the sister hasn't done anything after 12 months to remove my wife from the loan.

 

[txls]

So does your wife solely own the property? If so then she does have the right to sell, but if sister has been living there, then you need to research and follow rules for proper notices. She probably hasn't done anything to remove your wife from the loan because she can't. She would have to qualify for a loan, which she most likely doesn't.

 

[Bobbee47]

So does your wife solely own the property? If so then she does have the right to sell, but if sister has been living there, then you need to research and follow rules for proper notices. She probably hasn't done anything to remove your wife from the loan because she can't. She would have to qualify for a loan, which she most likely doesn't.

Thx txls. I hope it doesn't come down to that. I'll do my due diligence

 

[adjusterjack]

I'd rather not kick them out but the sister hasn't done anything after 12 months to remove my wife from the loan.

That will never happen because lenders don't "remove" people from loans. The sister will have to take out a new loan in her own name to pay off your wife's loan.

Bottom line: Your wife owns the house (the sister is not an owner) and the sister is living there with your wife's consent.

The solution is to give the sister and her family proper written notice (likely one month) that occupancy is terminated and then need to be out by the deadline date. If they aren't out by the deadline date, your wife files for eviction in court.

What does your wife want to do about all this? It's her house and her sister.

 

[Bobbee47]

That will never happen because lenders don't "remove" people from loans. The sister will have to take out a new loan in her own name to pay off your wife's loan.

Bottom line: Your wife owns the house (the sister is not an owner) and the sister is living there with your wife's consent.

The solution is to give the sister and her family proper written notice (likely one month) that occupancy is terminated and then need to be out by the deadline date. If they aren't out by the deadline date, your wife files for eviction in court.

What does your wife want to do about all this? It's her house and her sister.

My wife doesn't want to escalate the situation but her sister has not communicated any time line on her coming in with a new loan. So I'm preparing just in case.

 

[adjusterjack]

My wife doesn't want to escalate the situation

Then nothing will change.

 

[army judge]

Hi, my wife signed on a private loan for her older sister and I'm in the process to MAKE them take over the private loan. In case they don't comply with my demands since that my wife is on the loan and title, can we sell the house? Do we have full rights to kick them out?

duplicate post sorry.

You reside in California.

You might want to read about community property:

| legalzoom.com

You may not have known this, but you're responsible for the loan she took out, too.

I suggest you and she consult a CA licensed real estate lawyer.

 

[Bobbee47]

You reside in California.

You might want to read qbout community property:

| legalzoom.com

You may not have known this, but you're responsible for the loan she took out, too.

I suggest you and she consult a CA licensed real estate lawyer.

We're in Texas actually ArmyJudge. And yes I do know I am responsible for the loan. Hence my .

 

[army judge]

We're in Texas actually ArmyJudge. And yes I do know I am responsible for the loan. Hence my .

California or Texas = SameSame under community property laws

That also means YOU and your wife are equal owners of the property.

You can file a partition action to force the sale of the home.
Maybe you don't want to do that, but your wife needs to understand that the decision isn't hers alone to make.

I suggest you start charging the SIL SQUATTER rent.

You could start the eviction proceeding as a co-owner of the property.

Your wife needs to understand that what she does impacts you, too.

 

[Bobbee47]

Points taken and I will look it up, thank you again.

Another concern is, if the sister actually fulfill her duty and takes over the house with a new loan. What about tax related items? Does my wife have to report the property taxes that was paid by her sister? Can my wife sell the house without owing any taxes?

 

[adjusterjack]

Points taken and I will look it up, thank you again.

Another concern is, if the sister actually fulfill her duty and takes over the house with a new loan. What about tax related items? Does my wife have to report the property taxes that was paid by her sister? Can my wife sell the house without owing any taxes?

You'll need to talk to a tax pro about all that.

 

[txls]

If the sister is able to take out a loan, then your wife will sell her the house and the issue of property taxes due will be part of the settlement. Your wife won't owe any capital gains tax unless she's making a huge profit on the sale, which I would say is unlikely.

 

[army judge]

I don't loan anyone money.
I have never, and I will never be anyone's CO-SIGNER.
I occasionally give gifts to those that illustrate a need.
Lately, I give fewer and fewer gifts.

Have you ever seen a sign in a zoo that reads: "DON'T FEED THE ANIMALS" ???

When dealing with Homo sapiens, I say: "DON'T ENCOURAGE DEADBEATS" !!!

 

[army judge]

Points taken and I will look it up, thank you again.

Another concern is, if the sister actually fulfill her duty and takes over the house with a new loan. What about tax related items? Does my wife have to report the property taxes that was paid by her sister? Can my wife sell the house without owing any taxes?

Deadbeats RARELY honor or fulfill their many promises.

I hate deadbeats.

I've never been a deadbeat.

In fact, I've done without so as to avoid becoming a deadbeat.

The deadbeat won't ever get a loan.

If a bank won't trust a deadbeat, you shouldn't either.

I've used this tactic to shoo away deadbeats.

I offer to pay the first TWO or THREE payments, WHEN the deadbeat secures a loan.
My offer is contingent upon READING the loan contract.

I've never had to make good on my offer.

 

[ElleMD]

Your wife willingly took out a loan to give her sister some money. That is on her. She did not have to do so. If you want to be upset at someone, talk to your wife. Legally she didn't have to consult you, but perhaps your dynamic as a married couple would obligate her to discuss this with you first.

The sister can not legally "take over" the loan. She can agree to pay some amount to your wife, which your wife may use to repay the loan. This is not yet a legal obligation, but may be an agreement between the sisters. If this was the intent, then it should have been written up as a contract. As it stands now, it was just a gift from your wife to her sister.

Totally separate is the living arrangement. Your wife owns a house and her sister is a tenant. If your wife wishes to now sell the house, perhaps to repay the loan, she must follow state law as far as giving notice and evicting the sister.

 

[army judge]

Your wife willingly took out a loan to give her sister some money. That is on her. She did not have to do so. If you want to be upset at someone, talk to your wife. Legally she didn't have to consult you, but perhaps your dynamic as a married couple would obligate her to discuss this with you first.

The sister can not legally "take over" the loan. She can agree to pay some amount to your wife, which your wife may use to repay the loan. This is not yet a legal obligation, but may be an agreement between the sisters. If this was the intent, then it should have been written up as a contract. As it stands now, it was just a gift from your wife to her sister.

Totally separate is the living arrangement. Your wife owns a house and her sister is a tenant. If your wife wishes to now sell the house, perhaps to repay the loan, she must follow state law as far as giving notice and evicting the sister.

Sorry, OP lives in Texas.
Texas is a community property state.
The home purchased by the wife was acquired during the marriage.
Therefore, BOTH spouses own the home.