Investor · San Antonio, TX · Member since 2015 · 82 posts · 15 votes
I am a relatively young realtor in San Marcos, Texas and have been reading up on the FHA Kiddie Loan Program. To my understanding you can put down as low as 3% and it involves a parent/guardian co-signing on a home in order to build credit. Just for the sake of argument, I have excellent credit. However, this caught my interest because I am not in a position financially to buy a home and am very interested in investing in the next 2 years, especially near a college town. How would I go about convincing my parents to buy a home with me and treat it as an investment? I have at least 4 friends looking to rent a home next fall (2017) and feel this is very ideal.
Investor · San Marcos, TX · Member since 2015 · 272 posts · 360 votes
10y
Doing business with family and friends, what could go wrong?
The best advice I can give is not to do business with friends or family.
As for your specific question...treat your parents as potential partners. Make a business plan, have a professional deal analysis, clearly show a breakdown of responsibilities, expectations, and how the partnership would work. Present things in such a way that you are vetting their partnership for your deal.
No one likes when kids come to them with their hand out and notions of easy success, and without having put any effort into it. Parents want to see that you put in the time and effort, considered the possibilities, and are dealing with reality and not fantasy.
For you this should be a trial run and opportunity to learn. For them they should get an ROI of at least seeing you develop as a person.
If your parents cannot afford to carry the mortgage if you default then you should not be asking them to co-sign. You are putting them into an unfair situation.
Just my 2 cents.