Placing a house on the market is often a stressful project. After all the preparations to make the home attractive to potential buyers, the house may sit on the market for months or longer before a serious offer comes in. Some West Virginia home sellers are fortunate when a family member offers to purchase the house. However, they may question whether the steps they take in this family transaction should be very different from a real estate transaction between strangers.
While selling a home to a relative may seem like a family transaction, it is also a legal transaction; in fact, it’s likely the largest and most expensive purchase a person will make. Although the exchange may be between trusted family members, there are many legal considerations to take into account. For example, if the buyer is taking a mortgage to purchase the house, the seller will need to have the home appraised because the mortgage company will require it.
Additionally, if the seller is allowing the buyer to purchase the home at a price less than the value of the home, the Internal Revenue Service will consider the difference as a gift. This may result in a federal gift tax. There may also be liens on the property that will need to be settled before the sale can be completed. Zoning issues could affect the buyer’s ability to make improvements on the property.
Even if West Virginia family members opt to complete their real estate transaction without the help of a real estate agent, they may benefit from the assistance of an attorney. An attorney will help them navigate any legal issues that may affect the sale or potentially arise after the sale is complete. Attorneys can also handle title clouds and zoning issues.
Source: realtor.com, “How to Sell a House to a Family Member“, Jeanne Sager, Dec. 11, 2017