Primary Borrower and Co-signer Occupancy

[Amonrid Chaiprathum]

I’m in the process of helping my mother purchase her first home. However, we’re wanting to purchase a property as a primary residence and then later on convert into an investment property. 

So my mother is living rent free with her significant other but I want her to acquire a real estate property due to the financial benefits of real estate has to offer. 

Let’s say she takes out a conventional loan, 3% down and my brother is the co-signer. Does my mother (primarily borrower) have to live there (since she’s living with her significant other) if my brother is the co-signer and lives at the property?

He’ll live there for a year or so and then we’d convert it into a rental to bring in cash flow. 

The whole point is trying to avoid putting 20% down as a “Investment Property” if we don’t have to.

I’d would really appreciate your input! 
Thanks 

[Bill B.]

Is your brother going to live there for free? (Co-signers usually don’t make payments they just guarantee the loan.) if so, she’s going to sign paperwork saying she plans to live there for a year. Maybe she and her partner could both move there? if he’s going to be a co-owner and make payments then you should be ok, put him on title. Should she really be buying a home if she doesn’t qualify?who’s responsible for the payments and the repairs?

Be careful, you’re going to want everything in writing or you’re going to lose money and family relationships.