Chattanooga, TN asked in Real Estate Law for Tennessee

Q: What is the least complicated way to sell a 200k paid house to a son parents will finance sale Parents are retiring

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1 Lawyer Answer
Anthony M. Avery
Anthony M. Avery
PREMIUM
Answered
  • Knoxville, TN
  • Licensed in Tennessee

A: There are many ways of conveying improved real property to a son. I recommend hiring a competent attorney: to perform a title search including looking at the legal description; drafting a quit claim deed (since I doubt he wants to sue his parents); deciding upon an agreed purchase price which can be paid in a reasonable amount of time; draft a note, secured by a deed of trust, which has a decent down payment, then an annual payment each year for 5, 10 or 15 years; and after a closing (which includes him paying the down payment), record the QCD and TD. This is the correct way. However you may consider a life estate/ remainder deed, which will substantially lower the actual value of the present transfer, thus lowering any potential capital gain taxes. I do this type of family transaction as often as possible, and they usually go great. If not, then the parents can foreclose on him.

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