house & a half what to do?

Question

ok so I need some advise for the more knowledgeable than I. I inherited half of my mom's house when she died, the other half my sister inherited.  I also inherited 1/4 of my grandmothers house my sister has 1/4 interest and my aunt has 1/2 interest.

My aunt has done a soft rehab on my grandmother's house, with out taking into account any my sister or I said because we don't know what we are talking about. My aunt has no knowledge of investing or real estate but doesn't believe I do either. Anyway, I believe the house can sell retail around $160,000

My mom's house needs a good bit of work but can sell retail $100,00 as is. At current there is $82,500.00 in debt against the estate, hopefully it will go down but worst case $82,500 ( Id rather over estimate than under estimate)

So run down of the assets
-1/4 interest in a $160,000 SFH
-1/2 interest in a $100,000 SFH with $82,500 against the estate

What would you do with this?

I would rather do a wholesale on my mom's house and just be done with it, but I think there is too much debt against the estate to make that feasible. 
My husband and I were talking about buying out my sister's half of my mom's house and either flipping it or keeping it as a rental. We also talked about the possibility of buying out my aunt and sister on my grandmother's house if we sell my mom's house first and keeping it as a rental property.

I thought Id take this to the BP experts to get more idea flow. Id love to get other perspectives. Thanks for your time and answers they are appreciated.

Stephanie Foret · Answer

Thanks for your reply. I have thought about my sister feeling like she got the short end of the stick if we buy her out at $100,000 shed get 50,000- her half of the debt 40,000. So we'd pay her about $10,000. Then we could flip and probably make $30,000 I can see the resentment. I also don't want to try to partner with her....ugh.....nope lol.

The attorney doing our succession also does estate planning as well. He has brought to our attention that we have recourse on my grandmother's house since my aunt just went ahead and started dumping $ in with out any sort of agreement. While I'm a bit miffed that she dropped a $6000 stove in a middle class family home but left the counter tops that are from the 1950s or so and other bits like that. We agreed that we'd ask for an itemized list of expenses and she would be reimbursed off the top.

Over all it may be a better to just sell both and move on to avoid upset. I agree that family is more important than $

Tom Goans · Answer

Stephanie Foret,

This is just my opinion for consideration.

It is my understanding that serious family conflicts are prone to arise from inheritance. Family members feel they were mistreated, did not get their share, the property was mismanaged, and on and on. Next thing you know, here come the attorneys and threats.

My family eliminated this possibility by selling the large items, such as real estate and automobiles. The real estate was listed by a real estate agent and sold. The net proceeds were split as according to the will.

No possibility for argument, favoritism, or hurt feelings. We must moved on.

In your case, family unrest has already begun. You may want to take action to squash this before ... In the case of being a partner with your sister, buying her out could turn into her feeling she was pushed out or did not get her fair share. Especially if you make a profit later on. You may be wise to just sell the house, split the net proceeds, and invest your money in another property.

As it is said in the business world, an arm’s length transaction.

You may find it very helpful and comforting to seek the thoughts from an estate-planning attorney. It could be a really cheap investment to maintain family harmony. Your attorney will review with detail the entire picture, including all the family members and tax issues, and then provide recommendations and options for your consideration.

Just my thoughts. I feel family harmony is far more important than the all mighty dollar.