I’m in the process of possibly purchasing my brothers duplex. The goal is to apply for a mortgage at the same bank he applied for his mortgage and take over his mortgage.
First, I don’t even know if that’s possible.
Also if I purchase the duplex, how can he get his equity in the home if my down payment isn’t enough for his equity.
My goal is to do this to save me some interest since I believe he’s paid off a good chunk of it.
Is it a good idea to take over his mortgage or just start over.
Are there any special fees I have to pay for this process?
Is it worth it?
@Michael Acheampong , while I am new to investing to the point of still having cellophane on, I believe that the level of money you put down has little to do with what your brother receives. What your payment and the loan value sum to is another story. His return will be based on the total of your mortgage and payment minus his payoff value and transaction fees to transfer the property to you. If I am in error, will someone please correct me
@Frederick Wenger I’m all confused now.
@Michael Acheampong if you want your brother to get his equity, start a new mortgage
Assuming the mortgage doesn't have a ton of value to a seller except what (if anything) you pay, in cash, to them. All you're doing is taking over the payments and relieving them of the remaining debt. It usually happens when the current owners are underwater or can't afford the payments anymore.
If you got a new mortgage, title/closing agent will pay off your brother's remaining debt/loan balance and then give him a check/wire for the excess. Or if the new sale price is less than he owes, he will have to come out of pocket to pay the remaining balance