Updated about 9 years ago on . Most recent reply
Buying for Parents
Hello fellow BP fans,
Happy holiday weekend!
Parents will not qualify for a loan so we would like to buy home for them.
If they are listed as owners or co-owners, loan guaranteed/signed by my husband and myself - will loan qualify for 3.5 % down? What's the lowest possible down-payment?
The home is only 60 miles from my current primary home so it doesn't qualify as a second home for financing purposes. My husband and myself will live there part-time as we help take care of my developmentally disabled sister and it's actually closer to both our jobs.
Thanks so much.
Most Popular Reply
Two separate issues here: Title and loan qualification & terms.
Title: If this were my chore, I would create a Living Trust in the parents name and appoint you and your husband as the trustees with full POA for all financial and property transactions(the lawyer should provide an Abstract of Trust). Then, the trustee performs the purchase in the name of the trust, but this *may* require a stutter step of closing in your name and then QC to the trust. Try to avoid that as it can be seen as a taxable event.
Loan terms: getting terms for 3.5% down sounds like a first time buyers promo and not at all sure you or the parents would qualify. Find a local bank (ie not Wells, Citi, Chase), and discuss face to face - - you might get better terms, but anything less that 20% down will induce PMI and that will increase the monthly payments.