Elderly Woman - Lease for Remainder of Life

[Ryan Weimer]

BP community - I've got a tricky one and in need of help.  I've been able to negotiate a deal on rough terms with an elderly woman who is on disability payments with a ton of equity.  Because the market in her area is appreciating so much her property taxes are rising and making her monthly payments tight, and in her condition she would prefer not to move.  Basically I would receive the deed for cash equivalent to half of the current market value (to pay off what's left of the existing mortgage and what's left over).  In return I would offer her a lease for the rest of her life at a significantly discounted fixed rate.

While this is a somewhat grim scenario I am evaluating just how long that might be and the legal challenges of a "lease for life".

I'd be financing about half the cash (hard or LOC) so I plan to pull a HELOC to pay those back and then pay the HELOC back slowly over time. I'll be discussing the legal and liability risks of this with my attorney. I know this is a loaded question - what else should I be aware of? Anybody ever come across something like this?

[Colleen F.]

What comes to mind for me is it should be as long as she lives in the home, not as long as she lives.  You would also need to decide about what defines not living in the home ?  6 months? a year in a facility or elsewhere?  What about other occupants?  You are in California what rights do other occupants have if they start to live there with her?  There was one article about an adopted adult daughter of a NYC tenant  who inherited his rent controlled apartment- it was not pretty for the owners.  Just some thoughts...