We want to help our son and his wife get a house and they have bad credit so we wanted to get the loan and help them.
So if they are living in the house, what kind of a loan do we have to get to purchase the house?
2007-12-21 12:13:26 · 8 answers · asked by Ruth 6 in Business & Finance ➔ Renting & Real Estate
You would have to apply for the loan as a second home loan, which is higher rates than for a primary residence.
2007-12-21 12:37:59 · answer #1 · answered by Expert8675309 7 · 0⤊ 2⤋
My suggestion would be to take advantage of the FHA Kiddie Condo Loan program. ( It doesn't have to be a Condo, that's just the name of the program.) I would look into this before I went the investment loan route. These loans are available for only blood-relatives. The stronger borrower can use their income, assets, etc. and both borrowers take title and sign for the loan.
Advantages: Low down payment 3% of purchase price,
Lower owner occupied rate vs. higher investment rate.
New borrower ( son & wife ) get to establish better credit rating.
If this doesn't work there is always second home or investment home route.
2007-12-21 21:13:18 · answer #2 · answered by tampabaycreditdoctor 3 · 1⤊ 0⤋
You shouldn't buy the house for your son and his wife, but merely co-sign their loan. That way you won't be subject to non-owner occupied insurance rates (which are a lot more) and you would be helping your son and daughter in-law repair their credit and allow them to take advantage of the interest write off.
2007-12-21 21:17:54 · answer #3 · answered by linkus86 7 · 0⤊ 1⤋
If the home is located greater than 50 miles form your primary residence, you can claim the purchase as a 'second home'. Rates on a 'Second' home are the same as on your primary.
If less than 50 miles or you need to claim income from the property to qualify you will then acquire it as investment or non-owner occupied: which does have a slightly higher rate and qualifying parameter.
2007-12-21 20:49:26 · answer #4 · answered by Anonymous · 1⤊ 0⤋
You would be purchasing the home in you own name i take it. Then it would be considered a second home. The interest rate is a bit higher.
2007-12-21 20:18:49 · answer #5 · answered by Big Deal Maker 7 · 0⤊ 2⤋
Just buy the house as a rental property.
2007-12-21 20:19:13 · answer #6 · answered by lmnchcgfl2000 3 · 0⤊ 1⤋
The loan/mortgage would be in your name and you could let them live in it.
2007-12-21 20:23:16 · answer #7 · answered by Penny M 3 · 0⤊ 1⤋
It is a very nice present for your son and his wife. God bless
2007-12-21 20:21:11 · answer #8 · answered by Denny Crane 4 · 1⤊ 2⤋