How can I pay my parents?

[Jose Zaldivar]

Hey all, here is the situation. My parents are getting old and want to retire, they have the house I grew up on with over 200k in equity and a small mortgage that they still pay. The mayor obstacle that we have is that they don't have a social, they have a ITIN number. So few banks would even consider doing a cash-out/refinance. They few that I've spoken to said that they would do it at a 75% LTV and 6% interest rate. I have an LLC and been wholesaling for 2 years now. Other than refinancing and selling the house how can I get them their money? They want 200k at closing so carrying back a note is not really an option.

[Michael Glist]

I think that they (and possibly you) are thinking about the cost of the money in the wrong way. If the lenders you have found that ARE willing to lend to them have a higher rate, yes that sucks but, without it how much are they losing out on. If their goal is to but another primary residence as well as a few rentals then they money will not only allow them to do that but will also provide them with additional income (via rental income). I think checking with a few local banks, credit unions as well as mortgage brokers would be beneficial to see if there is a better deal out there but I think that not doing it over a rate that is 1% higher than the normal rate would be them losing out on a lot of opportunity. If you can find the better deal definitely do it as the last thing you need to do is pay more for a service you could have gotten for less but if you are going to pass up on the opportunity altogether due to the rate I think that is a bad idea.