Evidence Backs Sister on Verbal Agreement

Question: Three years ago, I moved from Chicago to Arizona to take care of my mother. My sister encouraged me to come to Arizona to help her with the care of my mother and, because I did not have good credit, my sister paid $25,000 down on a house and she qualified for the 15-year mortgage loan. My sister and I verbally agreed that this house would become mine if I made the monthly mortgage payments for 15 years. Since that time my sister has not paid a penny toward the house, and I have paid all of the monthly mortgage payments and repair bills, plus made significant upgrades such as a new kitchen range/oven, re-plastering of the walls and ceilings, and a new driveway. Every time I request something from my sister in writing that the house will be mine, she simply says, “If and when you fully pay off the mortgage in 15 years, it will be yours.” I am concerned that if I die, my two young children will have no interest in the home. Should I force my sister to give me an agreement in writing?

Answer: Yes. The statute of frauds (Arizona Revised Statutes Section 44-101) generally requires an agreement in writing for the purchase of a home or other real property. An exception, however, to the statute of frauds is partial performance of a verbal agreement to sell the home — that is, the buyer moving into the home and making the monthly mortgage payments. In other words, there will be strong evidence of a verbal agreement to sell the home when a seller lets a buyer move into a home and the buyer spends money on the home. Therefore, if your sister will not sign a written agreement now, you should contact an attorney to file a lawsuit to have a judge declare the enforceability of this verbal agreement with your sister. If you then die before the 15-year mortgage is paid off, your estate will be the owner of the home and will have to make the mortgage payments.