Sale of A Home Subject To A Life Estate
Price To Anticipate When Selling Real Property Subject To A Life Estate
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Rather than fair market value, the amount you receive will be based on:
- The current market value of the property.
- the cost of the use of the property that the new owner will not receive. For example, if the new owner thinks he could rent the house for $1,000 a month, and that you will live in the house for another ten years, he would reduce the purchase price by the present value of $1,000 a month times ten years.
Your health condition may help you negotiate a higher price because the buyer may think you have a lesser life expectancy than a healthy person your age. (From your perspective, keep in mind that every health condition has survivors- and you may be one of them. Statistics only relate to large numbers of people, reflect the past, and do not predict what will happen to any particular person).
If you don't live as long as is assumed in calculating the price, you will in effect have sold your house at a big discount.
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