Hi all, I have a situation,
I’m in the process of trying to close on a condo through a short sale. After about 4 months of wait, we finally got the bank approval from the seller’s agent and a reasonable closing date had been established. The seller’s agent said we can proceed with our appraisal. Seemed like everything was going well.
While waiting for the results of my bank’s appraisal, the seller’s agent sends us an addendum which says that I, the buyer, will pay for the seller’s backed HOA fees of $ 3000, with the addition of buyer buying the HOA docs ($ 500) and be reimbured ONLY IF the deal closes. Also, through emails, the seller wants me to cover some other fees despite that the contract they signed showed that they will pay it. Now if that isn’t enough, the seller’s agent says I must now close within 1.5 weeks, which my mortgage broker says the loan will definately not be ready by then, also the contract states the the closing date will be atleast 30 days after acceptance. I still haven’t even done an inspection yet and still waiting on the appraisal results!
Is this all legal… to make addendums after the seller’s bank’s approval? My agent said that they are "cheating" and trying to corner me, and said I can likely threaten to sue the seller’s agent for just the appraisal back, since such a scheme to have the agent’s license revoked?
What can I do?
I’m going to avoid PMI, closing costs, and get a really low interest rate of around 3-4%. Is there any downside to having him do this for me???
This would be a fixed rate. Not an arm or variable.
I don’t understand why he would mortgage you for a home
But a rate of 3-4% is a teaser rate (mortgages are around 6% right now). It will eventually go up and then you need to make sure you can afford 7-8% interest payments in 2-5 years.
I personally would get a fixed rate rather than a subprime or ARM mortgage.
the biggest downside I see is that it wont be improving your credit other than that sounds good to me
Two things, first a mortgage is a great way to build credit and by getting the loan from your father you won’t have any effect on your credit. And 2 usually loans between family member creates a giant strain on the relationship, you will be in debt to your father for 30 years.
If your father is going to lend you the money to buy a home (Dad will be the mortgage company) then please go through a company like Virgin Money to set up the loan. You will both sign legal papers because this will be a real loan. That way you can both get the tax deductions that you are entitled to (he as the seller and you as the buyer). Without a legally drafted mortgage agreement, you cannot take the tax deductions plus if Dad gets mad at you and wants to kick you out and take back the house, he can because without the paperwork showing the mortgage, you are just a renter.
If I understand your question, your father is going to obtain a mortgage for you ? Or is your father going to extend a mortgage to you ? Either may be OK as long as the contract is understood and complied to by both parties. If he should need to sell the contract, the interest rate is so low as to require him to take a huge discount for it. The advantage is that should you make a late payment, I doubt your father would foreclose on you or report it to a credit bureau. The tax situation is about the same as he reports the interest income and you deduct the payments.
I think your father is doing you a very big favor.
Good luck.
ya you get to avoid those costs, and that is great.
and she is wrong obviously above, if you have a non-adjsutable mortgage, it will never fluctuate.
the only downside is that if you go belly up, your not screwing over a bank, you are screwing your father.
and whether or not you think you would be able to afford it, loans are writen on a 30 year basis, and needless to say, life style change over basically half a life time.
so oother than you just ripping him off, nothing
There may possibly be a problem. Please make sure that you check IRS codes on personal loans and mortgage loans to individuals.
You will not avoid some closing costs. Those will vary by State, and most likely there will be a buyers Title policy to purchase.
On the other hand, FHA does have a “Kiddie Condo” program (terrible name I know) where your parents can legally co-sign. I suggest checking into that.
Just a question what happens if you should die before paying off the mortgage? Although this happens infrequently, should you die before the loan is paid off your parents may want to consider becoming the beneficiary of a term life insurance policy taken out for the same cost as the home. That way, should the impossible happen, they are assured return of their investment.
Speak with an insurance or financial professional before considering that other.