Private "Intra-Family" Loan - Secured against RE owned or

[Will F.]

Intra- Family loans are just loans between family. The benefit would be lower interest rates for borrower and higher interest rates for the lender (compared to holding money in CD or bank)nerdwallet heres a brief article about these type of loans.

Anyways. I was wondering what you all suggest as to how I go about this:

1: personal loan, have him wire me money and I pay as cash buyer. (Benefits- this might allow me to pull out more money in future out of the property as it won't show up in credit checks etc -allow me to make future RE investment purchases if I pull a line of credit or loan) OR
2: I could SECURE the loan using this as my primary residence. I believe I would have to document this on the deed (Benefits: Primary residence-write off full interest amount yearly off of Tax returns. Will help build credit worthiness with history of mortgage payments)

[Colleen F.]

If I was the person loaning you money (family or not) I would request it be a recorded mortgage on the property and for everyone's protection get it in writing. Family members get sick or sometimes die or even get married and there will be questions about what was the agreement, what are the terms, how are you computing the interest and what is still owed. You can get a private mortgage legally recorded. It also addresses the question of what is a gift and what is a loan. There is also a tax advantage of the interest statement on the property which would need to be issued by the lending party each year creating the documentation on the loan.