Sale of home after a relative's death

[Ryan Mitchell]

My mother in-law needs a mortgage to purchase a home that belonged to a family member that passed away. Our options would be for my wife and I to get a 2nd mortgage (our primary residence is in Indiana) or to co-sign on a mortgage with my mother-in-law. If we did the 2nd option, would she be able to claim homestead exemptions if we are on the mortgage?

Eventually (within 2-5 years?) we will be moving into that house and making it our primary residence. Which option would be best for us? Is there another option I'm not thinking of?

[Joe Splitrock]

Originally posted by @Ryan Mitchell:

My mother in-law needs a mortgage to purchase a home that belonged to a family member that passed away. Our options would be for my wife and I to get a 2nd mortgage (our primary residence is in Indiana) or to co-sign on a mortgage with my mother-in-law. If we did the 2nd option, would she be able to claim homestead exemptions if we are on the mortgage?

Eventually (within 2-5 years?) we will be moving into that house and making it our primary residence. Which option would be best for us? Is there another option I'm not thinking of?

 If your mother is looking for homestead exemptions, that would require her to owner-occupy the property. Does she intend to move into the property? 

Assuming she is going to live there, then she could apply for owner occupied financing and you could co-sign. In that situation, you do not have any ownership of the property, you are just a cosigner on the loan, so it doesn't affect homestead or owner occupied status.