Need advice on money arrangement with wife and mother in-law

[Kaytie]

Uh yeah. You are not getting the whole story here. Under no circumstances agree to this. I wouldn't even bother with the lawyer or anything like that. Just say, "No thanks" and stick to your guns.

 

You don't need the money, yet you are being pressured to this extent? What do your wife and MIL not understand about the word NO?

[pl3asehelp]

This is fast becoming a nightmare and you don't even have the money.

 

Do like avman says and tell her "thank you for the offer and it's much appreciated, but we'd really like to do this on our own".

 

If MIL really wants to gift the money somewhere, she can place it in a trust. I think the whole "I need to be able to get it in an emergency" jazz is a bunch of baloney. If that was the case, stick it in a bank to draw interest. Stuff the cash in a safe deposit box or fill up the mattress even.

 

Exactly - you don't invest money in a house that you expect to be able to access in an emergency either. Tell her the best you can do is promise it in 30 years.

[Godless_Heathen]

If MIL really wants to gift the money somewhere, she can place it in a trust. I think the whole "I need to be able to get it in an emergency" jazz is a bunch of baloney.

Come to think of it, there's a variant on this that works.

 

Have your MIL keep the money, and invest it. Every month she can send you the $300-$400 or so to help with your mortgage. If she has online banking, this can be completely automated - no need for her to write a check an mail it.

 

She always has the money "available for an emergency," no legal paperwork required, and she's helping out her daughter.

 

Now, she's not going to get 4% from a savings account, but 4% isn't that difficult to achieve. Personally with a 30 year time frame I'd use a mix of stocks and bonds, but there are lots of AAA corporate bonds that yield 4.5% or more.

[DN]

Come to think of it, there's a variant on this that works.

 

Have your MIL keep the money, and invest it. Every month she can send you the $300-$400 or so to help with your mortgage. If she has online banking, this can be completely automated - no need for her to write a check an mail it.

 

She always has the money "available for an emergency," no legal paperwork required, and she's helping out her daughter.

 

Now, she's not going to get 4% from a savings account, but 4% isn't that difficult to achieve. Personally with a 30 year time frame I'd use a mix of stocks and bonds, but there are lots of AAA corporate bonds that yield 4.5% or more.

That might work if her daughter were not a part of this.

 

My suspicion (only a gut feeling) is that you are being set up to share the house with your m-i-l (financially and meybe even physically at some point) and if the marriage goes pear-shaped you will not be entitled to the usual 50-50 share of the marital home. Not only will you be out the amount loaned but compounded interest. You could end up owing her more than whatever your share of the house is left.

[Anderson Silva]

Thanks for all your replies guys. It's evident that all your opinions are in line with the way I feel about the situation and it's also the same feedback I've gotten from a close friend. Having said that, I'll reject the money politely and stick to it. Thanks everyone for taking the time to help me.

[Godless_Heathen]

Accepting a gift every month shouldn't give her any leverage. So if his wife is fine with that arrangement, he knows she isn't part of some plot to leverage his MIL into the house.

[Fudgie]

I think the gift idea would work if it clearly were a gift. But it's not. If it were a gift, no lawyers/loan agreement would need to be set up.

 

I think you are making a good choice, OP. Stick to your guns.