Posted on: 12th Oct, 2009 01:14 am
my parents recently purchased a new home and i want to purchase their old one. i am a first time buyer and a little confused on the process. the house is worth somewhere around 250-300k. they owe 150k on it. they want to sell it to me for 250k but i would only finance 150k the rest they want to do as a second mortgage directly from them since they can obviously cut me a better deal than a lender (and they are not strict on repayment schedule). how should i proceed?
ryan
ryan
Hi,
"They want to sell it to me for 250k but I would only finance 150k the rest they want to do as a second mortgage directly from them.."
Do you mean you will enter into some sort of an owner financing agreement with your parents? Or do you mean they are going to offer you the balance amount of money to help you make the purchase? If you enter into an owner financing type of agreement, it is feasible. However, you will have to engage a lawyer to draft the agreement and set the terms for it. But if your parents are going to help you directly with the money, it will not be possible as it will be considered as seller funding. Sellers are not allowed to help the borrowers with the fund to make the purchase of their house.
"They want to sell it to me for 250k but I would only finance 150k the rest they want to do as a second mortgage directly from them.."
Do you mean you will enter into some sort of an owner financing agreement with your parents? Or do you mean they are going to offer you the balance amount of money to help you make the purchase? If you enter into an owner financing type of agreement, it is feasible. However, you will have to engage a lawyer to draft the agreement and set the terms for it. But if your parents are going to help you directly with the money, it will not be possible as it will be considered as seller funding. Sellers are not allowed to help the borrowers with the fund to make the purchase of their house.
Savior,
It soundsl like owner financing for the balance. Either way, the bank lending the $150k will want to see some kind of down payment....not a 100% CLTV
It soundsl like owner financing for the balance. Either way, the bank lending the $150k will want to see some kind of down payment....not a 100% CLTV
please listen to eric.
Thanks George, now can you repeat that so my kids can hear you too?