1st HH! How do I pay back

[Lauren Stiver]

Hey everyone! So I have been on BP for almost a year and I finally have my first house hack under contract! It's for sure been a hot market in Kansas City! This is a 2 unit home...not a duplex, but a large ranch house with a basement... a full HUGE apartment in the basement that can be completely separated...with a separate outdoor entrance and driveway on the side of the house in the ever growing south Kansas City area! My question is although this fha loan will be in my name, the capital for the down payment and closing costs will be paid for by private money lender. Does anyone have suggestions on how they may go about to reimburse this: would you pay it back fairly quickly w interest from all the money I'm saving from rent or deferred payment with interest? Or perhaps just give them xx amount of equity? Something totally different? Thoughts, advice? Thank you in advance!

[Edward Stephens]

Has your buyer's agent or loan officer given you any indication that your combination of an FHA loan + private money loan is even feasible? I'd hate for you to find out after coming this far that the FHA loan will be denied because the 3.5% down payment required will be coming in the form of a private loan. My experience (both as an FHA buyer and a buyer's agent) has been that buyers must either have the money for the down payment and closing costs themselves OR the money must come as a gift. It cannot be a loan. And it definitely cannot be a loan disguised as a gift. If that's the case, you're committing mortgage fraud. Talk to your buyer's agent and loan officer about this immediately. Message me if you need more personalized help or want to discuss more confidential details.