Help Needed to Pay Disabled Mother’s Rent
QUESTION: We own a condominium that’s not quite paid for and we rent it to my mother. She isn’t able to work and lives on a small pension ($350 per month). We don’t want to sell because Mom wouldn’t have any place else to go.
But two mortgage payments are too much for us. I still owe $95,000 on my home.
Where can we go to get help for my mother? I have contacted all of the local agencies (such as the Salvation Army, etc.). Mom desperately needs help, but the local agencies are all out of money. What can I do if the bank starts pushing me on the loan on the condo? Mother is 64 years old with a severe back injury.
ANSWER: I think the first place for you to start is the Social Security Administration to see if your mother is eligible for SSI (Supplemental Security Income). This is a cooperative effort between various states and Social Security to provide funds that will help to close the gap between an older person’s income and her basic needs.
Some of the states, such as California, have a relatively high minimum income standard--that is, the elderly person can have a fairly high monthly income and still qualify for SSI payments.
Unlike Medicaid, for the indigent, SSI eligibility doesn’t have a “means” test--a maximum on the resources that the applicant can own. SSI is based, purely and simply, on how much monthly income the person has.
Normally, SSI isn’t available to anyone younger than 65 but this doesn’t apply to your 64-year-old mother because she is considered disabled. You don’t specify the source of that “small pension,” but, for Social Security’s purposes, it doesn’t matter--it can, in fact, be a Social Security survivor’s benefit without disqualifying her.
Call Social Security’s “hot line” for more information: (800) 234-5772. Other than that, the only solution I can suggest is that you move her in with you and sell the condominium.
Strategy for Looking at Distressed Homes
Q: We are interested in buying a distressed house. What is the best way to get a list of distressed homes in the Sacramento area? We would like to be able to drive through the neighborhoods of the homes without a real estate agent and pre-select some houses to look at before actually going through the homes.
A: It’s a good strategy, particularly if you aren’t familiar with the city. Go to the library and look up the address of the Department of Housing and Urban Development in Sacramento. Send them a long, stamped, self-addressed envelope and ask for a list of the properties that they are trying to get off the books. Also, you might want to check with the advertising department of the Sacramento newspaper (The Bee) and see if HUD isn’t running display ads listing such properties.
Sell Home Before Urgent Need to Move
Q: In 1988, at the age of 41, and single, I bought a house in a subdivision--two bedrooms, one-and-a-half baths, a living room with a cathedral ceiling, with a one-car garage on a corner lot. The house cost $62,000 and I paid $20,000 down. My payment is $386 a month.
My problem is that I am alone, here, my family is in New York and my father is very sick. If I were living in an apartment I would move back today--but I have this house and no one to turn to for help. Can you tell me what I can do in case I have to go back on a minute’s notice?
A: Don’t wait until you have to make such a move “on a minute’s notice.” There is obviously nothing binding you to either the house, or the locale, so you might as well pave the way in anticipation of what you see as an eventuality.
Selling your home, either long-distance, or with a sense of urgency, puts you at a severe disadvantage. And, since you are thinking of going back to apartment living anyway, now is the time to start working on it. Take a look around your neighborhood and see which real estate company’s signs seem to dominate the “For Sale” market and give them a ring.
Owner of Two Homes Wonders Which to Sell
Q: For the past eight years I have divided my time between a condo I own in Florida and a home I own in Ohio. Now, approaching my 80th birthday, I am considering selling one of these properties so I can take advantage of the one-time $125,000 exclusion from capital gains. I legally established residence in Florida for tax reasons although I spend seven months a year at the Ohio residence.
My question: Can I take the capital gains advantage on the sale of my home in Ohio or am I limited to taking it on the condo in Florida? I would have a larger capital gain on the home in Ohio.
A: At first glance, this seems fairly elemental: Your “principal residence” would be defined as the home that is your legal residence--the condo in Florida, in your case--right?
You’d think so, except that for purpose of taking advantage of the $125,000 exclusion from capital gains, the Internal Revenue Service interprets “principal residence” as being the home where you spend the majority of your time. And seven months in Ohio, versus five months in Florida, would make the Ohio residence the eligible one.
“Legal residence,” or not, then, the IRS says you can take the one-time exclusion on the Ohio home, which it considers your principal residence.
Is It Advantageous to Buy Brand Appliances?
Q: We are remodeling our home with a view to selling it in a few years. How important is it to have “brand name” appliances in the kitchen? Or would chain store brands be acceptable?
A: You are quite right in the importance that you put on appliances, in the opinion of Suzanne Brangham, author of “Housewise: The Smart Woman’s Guide to Buying and Renovating Real Estate for Profit” (Perennial Library: $8.95).
“Appliances,” she says, “are expensive investments, whether you get top or bottom of the line, so don’t waste good money on a cheap unit.” Her further advice: Ask local appliance dealers (handling a variety of brands) which are the most popular, sell the best and have the lowest rate of complaint.
Also, read Consumer Reports thoroughly before making a selection and make sure that anything you buy is backed up by the manufacturer’s guarantee. An important “don’t”--don’t make any bold statements when it comes to color. Stay away, she recommends, from olive green, harvest gold, copper, brown or red appliances and stick with white or almond.
