Assuming Mortgage Deal
Mother will be putting home on market in the next month for 210,000.
She currently owes 38,000 left on it.
In order to afford her new Townhouse that she wants in the ballpark of 250-300k, she needs to use a good portion of her profits (100-130k) to use as a down payment.
Sounds like a good opportunity going to waste since she owes so little on the home. Agree? The idea is to rent the home afterwards.
Any thoughts, concerns, tips on making this happen?
I don't want to buy it for what she's selling for, but she also doesn't want to remain in ownership of the property.
Thank you.
- Rental Property Investor
- Boston, Massachusetts (MA)
- 2,236
- Votes |
- 2,363
- Posts
@Benjamin Jass don't agree at all. She uses the money (slowly gained over time) to ensure her being housed as she ages. Not sure how old she is but thats a big deal. After commissions etc. she will net about the 130K you mention. Enough to have reserves and a low payment, and even a potential of refiing the money out in the future maybe when interest rates decline. Oh, and she is not going to be taxed on this money
Whats not to like?
Rent the home at what? 1500/mo? Where does she live in the meantime? Unless she has other assets she can use to buy a home the option of keeping it is a non starter. And if you don't want to buy it at the number she is asking that means you don't see it as a good rental at that price.
I don't know enough about the property/situation to know whether this is a smart idea right this second, but she could explore utilizing the equity she has without selling...say a cash-out refi, and then just rent the property to offset her mortgage on the new townhome and pay you to manage this one for her.