I would like to know how to sell my house for 1,00

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I would like to know how to sell my house for 1,00

Thinking about selling my house to my son. I have a
real estate loan. Need to find out how that would work

Asked on October 16, 2018 under Real Estate Law, Pennsylvania

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

1) If you have a real estate loan, you have to pay it off before or at the time you transfer title; you don't, the bank can foreclose on the house. The lan is not cut off, or the bank deprived of foreclosure rights, by the transfer. In addition, a $1.00 transfer could be seen as fraudulent--an attempt to defraud your creditors by depriving them of an asset--and could be set aside or reversed under the Fraudulent Transfers Act.
2) Yes, you can sell the house to your son for $1.00, but assuming the house has some value greater than that, the excess value over $1.00 will be treated as a gift to him and will be subject to the gift tax. Speak to a tax preparer about tax consequences to your son and you before doing this.


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