Q & A with Dottie Herman

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Q1 - My wife and I recently inherited a property worth 250,000 and now have to pay a gift tax of 50,000. Can we get a loan to pay the tax and use the property as collateral? If we decided to immediately sell the home do we still have to pay tax?

A - Once you have title to the home you can take a mortgage loan for the amount your require assuming you are qualified for the loan. No need to wait to find out;, you can start by calling a mortgage lender now and get pre-qualified for the loan amount you are seeking. This way you will know where you stand and be able to move quickly once you have the property.  It is possible that you could apply for the mortgage in advance and have the monies days after you take the title to the house.  Good luck and congratulations! As far as tax consequences are concerned, you should consult a tax advisor.

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Q2 - I recently bought a new car but I haven't been able to pay my mortgage for a few months. Can the bank take away my car or force me to sell it if I default on my mortgage?

A - No, one has nothing to do with the other.  Each loan is separate from the other and the Security of the loans are also specific to the loan. As long as you remain current on your car loan you will have no issue with that loan.

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Q3 - My husband and I faced foreclosure in 2007, however, we were able to avoid that and we were able to get back on track. We currently have no debt and great credit scores. We want to purchase a new house and finance 30%. Are we able to qualify yet?

A - Past challenges in your credit do not preclude you from qualifying for a loan. Since you have gotten back on track and reestablished your credit you should be ok. However, you may be asked to explain the circumstances that caused the period of poor credit. The lender will most likely look to your recent performance and credit score. The fact that you have saved monies and will have a large down payment is also a positive indication of your fiscal health. So call a lender and begin the process with pre-qualification and they will review financial profile. 

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Q4 - I just purchased a home a few months ago. How soon after I purchase the home can I refinance or take a home equity loan?

A - Many banks have a 6 month seasoning rule that requires 6 months between the time you purchased and the CLOSING of the new refinance, this means you can apply for the new loan sooner but not close the refinance loan until you have pasted the 6 month date. The Home Equity loan is different and you should be able to pursue this loan right now without any restrictions.  Good luck with however you decided to proceed.

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If you have a real estate question for Dottie, please send it to; Dottie@RealEstateChannel.com

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