What kind of loan would my retired parents qualify for?

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What kind of loan would my retired parents qualify for?

Mike Franco
Los Angeles, CA · Member since 2013 · 555 posts · 261 votes

Retired parents have $1M liquid cash in the bank, looking to buy a $500k home with 20% down.

Clearly they have enough to buy in cash, but the plan is to use other peoples money and have the rent cover the monthly payments.

There's no income, but if banks could somehow quarantine some of this liquid cash each year, they would guarantee no default in payment.

Is there a low interest rate loan they can get?

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Dan Gamache
Lender · Boston, MA · Member since 2019 · 417 posts · 150 votes
7y

@Mike Franco a private lender will offer 30 year products (fixed or adjustable) with 20-25% downpayment. Personal income is not considered, underwriting will base the approval on the rental income vs monthly payment.

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  • Chris MasonPro Member
    Moderator
    Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
    7y
    Originally posted by @Mike Franco:

    Is there a low interest rate loan they can get?

     Ya, one of the GSEs recently revamped their "asset depletion" offerings. LO would need all paperwork to figure out how it'll play out, however. Loan app, tax returns, asset statements, whole nine yards. 

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  • Dan Gamache
    Lender · Boston, MA · Member since 2019 · 417 posts · 150 votes
    7y

    @Mike Franco a private lender will offer 30 year products (fixed or adjustable) with 20-25% downpayment. Personal income is not considered, underwriting will base the approval on the rental income vs monthly payment.

    1Reply
  • Stephanie P.Pro Member
    Washington, DC Mortgage Lender/Broker · Member since 2016 · 4k+ posts · 2k+ votes
    7y
    Originally posted by @Mike Franco:

    Retired parents have $1M liquid cash in the bank, looking to buy a $500k home with 20% down.

    Clearly they have enough to buy in cash, but the plan is to use other peoples money and have the rent cover the monthly payments.

    There's no income, but if banks could somehow quarantine some of this liquid cash each year, they would guarantee no default in payment.

    Is there a low interest rate loan they can get?

     Are they going to live in it?

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