Refinance Mortgage Help
Need some advice both financial and legal. My mother is selling her house but in the meantime she has seen another house she wants to buy. She has no capital and I have agreed to buy it for her. While I can put capital of 25% down on the house I still need to find the remaining funds, so I am assuming mortgage, my own is paid off.
But when she sells her property she will give the funds to me to pay off the debt, this may only be a matter of months. So my question is does a mortgage sound the right thing here, should we put it in joint names, if only my name can I transfer the house to her and is their any capital gains issues if I just put it in my name then she give me the cash to pay it off……help.. by the way i am in the UK
In the US: you could purchase the new home together, both names on the mortgage and title. and when she has the proceeds of her new home you could pay down or off the principal of the new existing loan. (only if there is no pre-payment penalty) some banks require a 2 or even 3 year prepay penalty that means you will be penalized a percentage of the loan amount if you pay if off early. so make sure you let your mortgage broker know what you plan to do ahead of time that way he can find the best program.
YOU will not be able to do the loan as a primary residence if you already have an existing mortgage reporting on your credit- even if there is a 0 balance, although your mother probably could seeing as she has her current home on the market. the underwritter can clearly see she is trying to move. but it will be a controversy between each lender as to how they are going to classify it.
(you- second home or investment property and your mom- primary residence.) but in this case mortgage would be the best bet and you both can be on title. or you can buy the home in only your name and have her on title with you. either way- when you get ready to do this discuss it with your mortgage professional in the UK. Goodluck
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June 20th, 2010 at 10:37 pm
In the US:
you could purchase the new home together, both names on the mortgage and title. and when she has the proceeds of her new home you could pay down or off the principal of the new existing loan. (only if there is no pre-payment penalty) some banks require a 2 or even 3 year prepay penalty that means you will be penalized a percentage of the loan amount if you pay if off early. so make sure you let your mortgage broker know what you plan to do ahead of time that way he can find the best program. YOU will not be able to do the loan as a primary residence if you already have an existing mortgage reporting on your credit- even if there is a 0 balance, although your mother probably could seeing as she has her current home on the market. the underwritter can clearly see she is trying to move. but it will be a controversy between each lender as to how they are going to classify it. (you- second home or investment property and your mom- primary residence.) but in this case mortgage would be the best bet and you both can be on title. or you can buy the home in only your name and have her on title with you. either way- when you get ready to do this discuss it with your mortgage professional in the UK. Goodluck~
References :
mortgage professional in US (texas)
June 20th, 2010 at 11:09 pm
These are all good question and need to be dealt with as to clear up any confusion down the road, first ,good man fro helping out Mom, !st thing you can do is land trust , there by getting here name on title asap fairly easy to do, I am in the process of doing this with my fiancee as to ward off the IRS folks , and capital gains I d don’t think that will be a problem , be sure to explain to you CPA or tax person what happen with copies of closing statements and detailed letter to be filed with taxes, don’t let them bullshit you and say you can send a letter that’s crap send the letter to e safe it takes 2 min. oh yes paper trail the funds as to avoid any misconception there, Mortgage Hmm yes I suppose so I would go with COFI loan or something to that effect , as to get best and lowest interest rate,ask any banker the will explain COFI, and quite frankly I would consult your bank , if credit is up to snuff, they have lowest fees and most people are certified in one way , and wont stroke you like a broker may, not that would all those that may read this, but Being a broker and knowing brokers they are interesting folks! also I may call a friend to find more details curious my self feel free to drop a wire hardmula@gmail .com Tom
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10 years beating the streets, 2000 = loans