Buying a Home With Friends or Family

what's up everybody zach mcdonald your real estate agent with real property associates and i've got with me bill kessler from beresford booth thanks for joining us today bill thank you for having me cool well if you don't mind can you introduce yourself so everybody can get to know you a little bit and then we'll kind of jump into the interview a little bit sure uh again my name is bill kessler i'm a business and real estate lawyer at the firma bearsford booth uh we are in downtown edmonds um i do a lot of business law on the transactional side as well as the litigation side and i do a lot of real estate law on both the transactional um and uh litigation side and have worked with zach for several years and happy to to be here to talk uh with you guys a bit about uh tenancies in common and llc's and and uh people uh buying properties together in general i think yep um what what differences are there so if we're in a situation where maybe somebody's buying it with a friend what does what does that look like it's a little different than a uh dating or marriage relationship yeah what is the difference in how they should approach buying together as friends yeah i'm seeing a big uh uptick um in people buying property together who are uh who are who are not dating um and and they're not just doing it as business partners you know buying an investment property together that's always been sort of common um but very common now for people who want to live in the house who are buying like two couples buying together or two single people who are friends buying together simply to be able to afford the place because obviously um real estate prices around here are so expensive so um yeah as as you touched on zach you've got people in other markets like la san francisco new york that that have been doing this for a while now and and it's becoming more and more common in seattle and i don't know how many i've done over the last year or so probably a dozen um where where you've got friends whether it's individuals or couples that are buying together and intending to live under the same roof so it makes a lot of business sense i think it's a great opportunity for people um but it's got to be done the right way and people people know that intuitively um you know they think they they start thinking of possible issues just like anybody normally would off the top of their head but what's super important for those couples to do or i'll say a couple i'll use an example of two couples two couples buying together both intending to live at the property and use it as uh as their primary residence for tax purposes and otherwise um then it's important for them to to do that the right way um and to have a contract that the government what is that what does that look like i mean what kind of a contract should they have in place i'm assuming it's a little different than if they were in a committed relationship together right very different yeah so it they are what will happen when when people buy together and they want to live in the property as their primary residence they they want to live in it um uh as tenants income they want to own it as tenants in common um and that is uh it's a strange term it's an old english term it sounds like you're renting something you're like tenants what do we what does that mean sometimes some people heard the the term joint tenants with right of survivorship that's usually like husband and wife on a bank account it's very common but uh uh joint or tenants in common is the default way that two people uh would own a piece of property so if you and your wife and me and my wife bought a piece of property together and we just we got under the purchase and sale agreement and it and it just said our names and then we went and closed um it all all the buyers names are are right there on the deed so it's it's uh jane and bob smith convey to bill and zach and christina and holly it's just like all our names are right there on on the deed so if you if you look at that deed you take from your seller and your and on the names are all there tenants in common is is how you own it and there's a whole bunch of laws that just automatically apply to you when you own as tenants in common um and a lot of them aren't really good okay they're not really good they're not for the for the the people who who own together but it's how you have to own uh or it's how you should own if you're going in most in most people's cases it's how you should own if you're going to um claim that property as your primary residence for tax purposes uh so that's that's the the business relationship is called a tenancy in common and then you have a contract not an agreement regarding status of property that's for couples you have a contract called um a tenant a tenancy and common agreement or the the slang for it is a tick a tic um and that's your that's your your your partnership deal with your co-owners um is a tick so in a tick what are a couple of the things that are really important in the tick that help make it a little bit more clear as to how the relationship's handled versus if you just went ahead and did it without the agreement sure yeah well the tick answers questions uh for people and it um and and it it kind of narrows the the focus uh from what people think of in kind of an amorphous way into into a more specific uh more specific agreement um so it answers it answers what if questions um what if what if i want to refi uh and and zach wants to uh doesn't want a refi what if i want to sell and zach doesn't um what if zack wants to bring in a tenant and i don't rent out a room to somebody else and i don't what if zach wants to remodel and i don't um uh what if what if zack and i uh get sick of each other and don't wanna don't wanna live there anymore yeah right but uh uh so so it answers what if questions who pays what expenses what happens if i pay more than zach does what happens if he pays more than i do i tell zach not to remodel but i come home and he's got a construction project going on right but what what do we do um what if we just can't resolve our differences what do we do if we just if we have big differences and we can't resolve them how do how do we get those resolved do we have to resort to courts or do we have alternative dispute resolution methods that that we can implement that are that are uh streamlined for uh for co-owners like us and not made for multi-million dollar disputes so there's there's all these um all these questions that can be answered inside that tick and um and it again it really it helps people on the front end uh get get their get their focus narrowed and answer those questions and get real comfortable with each other uh rather than just wondering what those issues that's right it's gonna go well that's right that's right waking up at two in the morning go what a what about this situation you answer all those things in the contract up front so and you guys get paid to think through those things and do this on a regular basis versus somebody just right that's what situate googling essentially yeah that's the service we provide is is to get give them that product but also to provide independent and detached legal advice and and judgment that that helps people to that where we can provide that dispassionate uh analysis and and also not just the product at the end of the day but going through the process of creating that product that um is going to to give people that comfort and that peace of mind that they've uh that they've addressed all the issues that they need to address before they get in it's great to get into the relationship yeah well thanks for giving us a little bit of an education on the ticks thanks so much for watching this video interview with bill kessler and talking a little bit about the different entities and ways to buy real estate together i hope this video was super valuable for you and if you want to talk more about buying and selling real estate here in washington state i'd love to be a resource for you and if you want to talk with bill a little bit more about how to structure a purchase or come up with some of these agreements that he mentioned in the video i'm going to link up his contact information below and you can always reach out to me for it as well you

Channel: Zach McDonald Seattle Real Estate

Views: 13,757

Keywords: real estate law, real estate attorney, real estate attorney seattle, how to buy a house with a friend, is it safe to buy a house with a friend, interview with bill kessler, bill kessler, bill kessler real estate, zach mcdonald, mcdonald real estate group, buying investment property, how to buy a house with family, should i buy a house with a friend, should i buy a house with family, buying a house with my brother, buying a house with my sister

Id: e5oxFrXEAb0

Length: 8min 57sec (537 seconds)

Published: Mon Dec 20 2021