All Forum Posts by: Brandon Bell

@Tom S. The difference there being... If I can assume the loan, then the debt is removed from his name vs. if I make loan payments he is still tied to the debt. Is that correct?

Through previous dealings I understand that when getting a loan there is typically a statement indicating whether or not the loan can be "assumed". I am really trying to find a route alternative to that under the impression that loans are not assumable on average.

@Bill B. Currently he has an escrow balance of $1,413.92. This must be overpayment that has collected as a balance. I'm sure he is just overpaying escrow... Wonder if it's possible to refine that to a more accurate amount.

I'll have to ask for additional breakdown for more detail.

@Bill B.

1) Home is worth $220k now, principal balance on loan is $179k. I would be willing to pay the gap as a down payment and assume the loan at 3.875%.

2) I agree! Isn't that outrageous? What am I missing? I have a (slightly smaller) home in the same county with good insurance rate and pay $370/mo to escrow. I am very confused how it could be so high. Surely my insurance isn't that much better.

2a) would I be able to change insurance if I assumed the loan? What other changes could I make to possibly refine the monthly payment.

Buddy is selling his home and open to creative/seller financing with me (buyer). I am not finding a way for this to be a win-win transactions. Am I missing something or is this just not a cashflow opportunity?

His current monthly Payment Breakdown:

- Principal: $314.66
- Interest (3.875% rate): $578.779
- Escrow: $700.79

-TOTAL monthly payment: $1,594.24

Estimated rental income: $1.2k - $1.6k per month.

Would love to somehow capitalize on the existing fixed rate, but at his current monthly payment and the estimated rent it doesn't seem like a great opportunity for cash flow. Am I missing something?

Home is in move-in condition and no renovations needed.

@Kristine Ann No, but spoke with connection/VP at the bank. Explained the situation and he said it may be a challenge to get another conventional loan (investment loan is being considered as well but; Family loan = plan A, bank loan = plan B).

We want to keep the property we live in now (since Oct 2023) and rent it out when we leave. The property we wish to purchase would be a fix & flip. During rehab process the bank sees us with; 2 mortgages, 0 rents, and 1 income (spouse not working) and would be too risky. 2 mortgages will make us at borderline break even cash flow with existing income. We have a chuck of cash stores to keep us going for a while as emergency if needed. Parents recognize this and are comfortable/agree. Bank is cold about it. In 2-5 years we will have moved into new property and secured a renter to cover mortgage in the existing home. With an established rental income on the existing property and more appealing cash flow the bank would find us more eligible for a loan at that time. I also want parents to have the option to back out in 2-5 years if for whatever reason they no longer feel comfortable or want to invest somewhere else.

We would prefer the loan from the parents. They have the money in CD's set to expire soon. The interest rate we would pay them would be more that the CD rate (win) yet lower than the banks mortgage rate (win).

@Konstantin Ginzburg No bank is involved in the transaction. Parents will cover the purchase price. This will not be a "gift" since there will be interest on the loan from the parents.

Additional: I spoke to the bank and they told me they would not be involved in a peer-to-peer loan such as this.

We found a house we want to purchase. My parents want to help us pay for it and we pay them back on interest. What is the simplest way to do this? Any resources who can help us structure this (other than https://www.nationalfamilymortgage.com/ who does not offer support in our state)?

Here is what is being considered:

SCENARIO 1):

1) Parents loan us money at X% rate.
2) Loan terms would allow for early payment without penalty (we would get a conventional loan in 2-5 years to pay parents back).

Q1) Is there a minimum interest rate requirement?
Q2) Would there be an issue with this?
Q3) If it's a loan from our parents that we are paying off, who holds the title to the home?
Q4) How would the parents' ROI (interest pmt received) be taxed?

SCENARIO 2):

A) Parents buy the home and we live in it.

QA) Is there a way to make this work that we would ultimately buy the property in our name? Rent-to-own, or something? Ultimately after 2 years we would be able to get a conventional loan and pay them back. Their assistance will help us buy the house now.

Thanks @Jay Hurst I looked into them and they appear to not offer services in Kansas, which is where we are needing support.

We found a house we want to purchase. My parents want to help us pay for it and we pay them back on interest. What is the simplest way to do this? Here is what is being considered:

SCENARIO 1):

1) Parents loan us money at X% rate.
2) Loan terms would allow for early payment without penalty (we would get a conventional loan in 2-5 years to pay parents back). 

Q1) Is there a minimum interest rate requirement?
Q2) Would there be an issue with this?
Q3) If it's a loan from our parents that we are paying off, who holds the title to the home?

SCENARIO 2):

1) Parents buy the home and we live in it.

Q1) Is there a way to make this work? Rent-to-own, or something? Ultimately after 2 years we would be able to get a conventional loan and pay them back. Their assistance will help us buy the house now.

This was confirmed. Lender A was correct. Although lender B swore up and down it could be done, he last second informed me that he was mistakenly referring to a previous duplex offer - which does not require self-sufficiency test.