I have a client that is trying to acquire a house for 189,000.00. She wants to use her dad as a co borrower. Her middle is 615. The current owner of the house is her dad and she is wanting to buy it from him because he is in Jamaica. She doesnt want a mortgage payment over 800.00. Her dad has excellent credit and she wants to purchase the home from him as her own home. Currently the payment on the house is between 1200-1300.00 a month. She cant afford that amount, she has one child and has about 3000.00 reserve in bank. Can anyone help me on how I can obtain creative financing for this person.
Using a standard 30-year she’d have to get a 1% loan (probably not going to happen)…or she could get a $94.5K (half) at 7% and get her dad to defer the other half until she can afford it…
IMO, this kinda falls into the category of “unrealistic”…
But, maybe some of the finance guys have a deferred payment product…?
thats what I was thinking Keith. She would need about a good 18,000 to 20,000 to buy her interest rates down. And she doesnt have that money available at all. It would take her a while for that. thanks for you response.
The Dad gives the daughter a gift of equity to use as her down payment. With that credit score it will be tough to get her payment down to $800/month though.
The dad bought the house in June 04 , so there really is no equity in it to give away. if the house was bought at 189,900.00 and thats the full appraised value
The father should refi to get the loan down to or near the $800 per month she can afford. He can then simply place it in a NARS land trust and grant her a beneficiary interest. There will be no violation of the DOSC and she will have acquired all homeownership rights without having to qualify for a loan.
The dad bought the house in June 04 , so there really is no equity in it to give away. if the house was bought at 189,900.00 and thats the full appraised value
LTV/CLTV is going to be the problem. Even with a perfect credit score it is going to be tough getting to $800. In essence you are looking for a 100% loan. Dad is probably paying an average for 80/20 blended rate of 7-7.25% now. So even if you went I/O on first do not know that you can get it that low.
What about if dad refi’d to an option arm then followed MTNWIZARDS plan? That would put her minimum payment at $660.00 (give or take a few cents) based on a loan amount of $200,000. I raised it a bit to roll in closing costs. However, can dad find a 100% option arm? Also, not knowing taxes and insurance; I can’t say that even that scenario will keep her payment at $800.00.
Good post. She will be able to afford a little more than $800 per month. Remember, she will now be writing off the monthly interest and property taxes. Let’s say her writeoff is $600 per month or $7200 per year. Her after tax income will be much greater than if she was just renting with no writeoffs. I think we have found the solution.
If the father has good credit. I can do a 100% refinance option loan around 1.65% start rate. This is definitely your cheapest option no matter how you slice it.
Robert if you can please give me a call at 678 760 7516. My name is raheen. I did leave a message on your voicemail as well, the father does have good credit. IF you can at your earliest convienence give me a call and I would be more than glad to talk with you about this situation.