Hello, I am unsure if this is the right place to post about this but here I go. My husband and I are in our late 20s and we have a newborn (first and only grandchild in the family). We live in SoCal and haven’t been able to buy/afford a house in our desired locations. We currently live at my parents house paying some rent while stacking up our savings as we both work FT (I’m currently on parental leave). Although we have thought and semi discussed this before, we are seriously reconsidering building an ADU at my husband’s family’s home. They have about .25 acre lot and have a good amount of unused land in their backyard that would perfectly fit an ADU (used to be a playground). My husband’s parents seem to be in favor of this decision, however, we feel there’s a lot to discuss to ensure fairness in our family affairs. My husband has 2 younger siblings that are in their early/mid 20’s that both still live at home. His parents also have land in AZ that they seem interested in developing in the future to possibly retire there. Anyways, I think we’re all kind of stuck in how we should go about this. Obviously my husband and I would pay for the ADU and any associated costs. We have scheduled a meeting with a bank loan officer to see what our options are. Not sure if this will be a 2nd mortgage on his parents part, or if this will be a builder loan or whatnot. The thing is, his parents still owe around $250k on the house after taking out equity. They bought the house originally for around $100k 25yrs ago. They have done some remodeling and built a pool. The house is now worth approx $700k. Maybe less maybe more. What concerns all of us is how we will make it fair for the other siblings. We all want the ADU as we all want to keep the house and the land within the family. The grandparents want us to be close and I feel this is a great opportunity and a good decision to keep the family together. My parents also live 5min away so we are all happy with moving forward with this decision. My husband and I also see us staying here long term for at least the next 10yrs. Again though, I’m not sure what questions we should be asking the parents and the bank officer, what we should be putting down in writing, etc. My husband’s parents seem to want $ out of it if they sell us the house if their other kids don’t want it so they can retire later on. His siblings seem to support us with the ADU idea but I don’t think they see themselves continuing to live in the main house a few years from now. This may be simple and I may just be overthinking. It may be as simple as getting a builder loan for $150k, building the ADU, living in it close to family for years, and eventually buying off the main house from my husband’s parents when they’re ready to retire. Maybe by then the other siblings may have moved out and are uninterested in paying for part of the house or whatever people do when they pass down a mortgage (a trust?). Honestly, not sure what I’m looking for here but writing all this out made my thoughts a little clearer.
Thanks in advance for your input!
TL; DR: Thinking of building an ADU at my husband’s parent’s house but I’m overthinking the costs and family affairs. Parents have made it clear that they would want to be “fair” in distributing their “wealth” (house mortgage) if they pass away to all 3 of their children.
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source https://www.reddit.com/r/RealEstate/comments/1eawlcv/adu_and_family_affairs/
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