Potential problems if brother gets the mortgage

[Marcin G.]

Hi,

I found a condo for an investment with tenant already in placewith a lease till 2019. My problem is that I cannot get conventional mortgage because I am only 3.5 years after foreclosure of condo in Florida. I spoke to my brother who has perfect credit and he is willing to help.

What is the best way to go ahead with this investment?

1) Can he just co-sign the mortgage? I would be the owner on the deed and do taxes for this investment property, and be responsible for any tax on capital gain when I sell.

2) OR the only way would be if he purchases the condo for himself?

3) What other potential issues I should be considering?

Thank you for any guidance in advance!

[Kim Bayless]

A possible scenario is him buy it, then sell it to you subject to the existing mortgage. That will cost you two closings though. Or have him buy, put the condo in an LLC, and then you buy him out of the LLC. Either way, he would have to be the original buyer to get a conventional mortgage with his credit.