need help or advise . what is my best option

2 Replies

hey how is everyone hope everything is well, I am fairly new to investing and I am in need of some advice. My parents are looking to sell me their house they still have a mortgage on it about $75K ,  the estimated house value on the house is around 130k . my idea is to buy the house using a 203 loan or Fha loan  and upgrade it . The house has 3 bedroom  2 bath upstairs and 2 bedroom in the basement level . Thinking about adding a bathroom and a kitchen in the basement level then live downstairs and rent out the 1st floor level 3/2. Any thoughts or suggestion to this particular situation any help will be greatly appreciated. Thank you in advance

Originally posted by @Josue Rivera :

hey how is everyone hope everything is well, I am fairly new to investing and I am in need of some advice. My parents are looking to sell me their house they still have a mortgage on it about $75K ,  the estimated house value on the house is around 130k . my idea is to buy the house using a 203 loan or Fha loan  and upgrade it . The house has 3 bedroom  2 bath upstairs and 2 bedroom in the basement level . Thinking about adding a bathroom and a kitchen in the basement level then live downstairs and rent out the 1st floor level 3/2. Any thoughts or suggestion to this particular situation any help will be greatly appreciated. Thank you in advance

 To do a bathroom in the basement you have to make sure there is enough "grade" for the waste to flow to the sewer or you will have problems. 

Talk to a mortgage broker. (Banks can be nasty.) On an FHA they will cover 97% of the selling price or of the appraisal whichever is less and that is for an "arms length" purchase. I don't know if they will go for it since you are buying from your parents. That isn't considered "arms length".

You could do a Wrap for the purchase amount to your folks to purchase the house then after proper seasoning (6 months?) you can refinance and pay off your folks. You have a good opportunity. Find a mortgage broker (not a bank, they are too limited) and pick their brain. 

@mike. Sounds good. Thank you for the information I’ll reach out to some mortgage brokers in my area and see what I can come up with.

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