Do you want to help your parents buy a home but they can’t qualify? Do you have a disabled adult child that needs a home but can’t qualify? Fannie Mae will allow you to purchase a home for your parents and consider it an owner occupied home.
A principal residence is a property that the borrower owns as their primary residence. Typically that means that they live in the home. However, there are a couple circumstances that apply for those that may not live in the home. If your parents are unable to work or do not have sufficient income to qualify, you can purchase a home for them and consider it a principal residence. That also means you get the best interest rates on that home. You will be responsible for the mortgage payment and you need to be able to qualify with your debt and your parent’s home. The parents do not need to be on the loan with you.
Another way this can help you is if you have a handicapped adult child that can’t work or may not have sufficient income to qualify for the home, you can buy a home for them too. The same rules apply, you need to be able to qualify for the home with your current debt, you will be responsible for making the payments.
I had a client that needed to help his father out, he had been making the payments on his dad’s mortgage but the rate was higher. We were able to refinance the home into the son’s name, lower the rate and allow his dad to keep the home. It was considered a primary residence and he was thrilled that his dad was able to keep his home.
If you are wondering about helping parents out – maybe they want to move closer to you or maybe they are struggling with their current mortgage payments, this may be a way to help them with a lower payment. Just remember you will be responsible for the mortgage payment.
Leslie Vanderwerf, NMLS ID#335509, Cross Country Mortgage LLC, An Equal Housing Lender, NMLS#3029 – Email – Website