Forgotten Your Password?

Need to Register?

Question Icon

can my mother sell me her house for the amount she owe bank 109000 the FMV of the house is 250000

My parents got divorced. and My mother got family house by divorce prperty settlement,In order to get her ex-husband from the note, she has to refinance it to her name. She does not work., that is she does not have income to show in order to refinance on her own, and I know that I cannot be co-signer for the new loan if I am not at least six moth on the titile. As a solution can my mother sell me her house for the amount she owe to the bank=109000.00 the FMV of the house is $ 250, 000. House is in PA Bucks County. Do we have to pay downpayment? What is the cost? by lsoll1_664_922 from Langhorne, Pennsylvania. Feb 15th 2012 Reply


Donald LaPlume (dlaplume)
#6 ranked lender in New Hampshire - 47 contributions

Yes she can is the simple answer. It sounds more like you want to help your Mom out of a tough situation though. If she wants to keep the house and continue living there she can do a type of mortgage governed by FHA. A Reverse Mortgage. There is are many myths out there about reverse mortgages. If you have not considered this please feel free to give me a call. 603-543-3700 ext 1. Here are the key points - Reverse mortgages do not have any payments now therefore no income or credit for that matter is really needed to qualify. The loan is paid off when your Mom moves out of the house permanently. Because these loans are so misunderstood the governmnet has set up a simple strucutre to help you get all of your answers about a reverse mortgage. Once you speak with a banker we would providse a list of councilors available in your area or by phone. These councilors have nothing to do with the banks doing the reverse mortgage. They are there to help your Mom determine if a reverse mortgage is right for her. I have set up a 35 minute web class about reverse mortgages which you and your Mom coult take for free if you like. It is at www.homebuyeruonline.com.Wishing you all my best,Don LaPlumeIf you are inteso I have put together a class on them in our online university.

Feb 15th 2012
1
0
Geoff Longwell (glongw_557_660)
#46 ranked lender in Pennsylvania - 7 contributions

You have some options for sure. I'm in Central PA, happy to discuss with you. www.englendingpa.com

Feb 15th 2012
0
0

Thank you for your answer. Yes It will be my primary residence, not an investment property. What would be the chepest way to puchase it.?How it works? My mother does not have any money to gift it to me for downpayment. Is there some other way? Dear ibennett, you just mationed conventional loan at 3.5% downpayment. In our case the sale price would be $110,000. the market price for the house is at present $250,000.00. In our situation settlement cost wold be probably $10,000.00 including transfer and lown origination fee fees. Then perhaps the best solution is to get my name on the title and wait 6 moth and then refinance it,

Feb 15th 2012
0
0
Chris Milker (cmilker)
#34 ranked lender in Colorado - 5 contributions

FHA allows for sellers to gift to the buyer part of the equity of the house that they are selling. This is called a gift of equity, but can only work between those that are relatives. This gift can be used for both the down payment and the closing costs. All other FHA guidelines apply to this type of purchase. ie. Credit qualifying and income.Keeping in mind again that this can only be done amongst relatives. How is this achieved? There are 2 ways for this to happen. And keep in mind that both the seller and buyer have to be a relative of each other.1. The 85% rule which is the easiest and quickest. If I am the buyer, I could buy my sister's house but my loan amount can't exceed 85% of the value of the house. I would also be able to get the full 6% seller contribution from the seller. It doesn't matter if you show it as a 6% seller contribution or just as a gift of equity, it's all the same and coming from the same place. The bottom line is that it gets deducted from the seller's proceeds of the sale. EXAMPLEPurchase Price of Home (sales price) $100,000 Maximum Mortgage Amount (x 85%) $85,000 Seller owes on current mortgage $60,000 Seller's net profit/walk away after settlement $25,000 If seller was going to gift closing costs? (a) $6,400 Seller's total net profit after closing costs paid (b) $18,600 Borrower's total out of pocket monies ZERO (a) This is just a basic example of what closing costs might be. They can drastically vary depending on the state and also on how many points the borrower wants to pay.(b) There will still be added expenses from the seller. ie. Title insurance, closing fee, sewer, water, etc, etc. ***The seller does lose that equity which is the difference between the purchase price and the loan amount. Hence the reason why they call if a gift of equity. You are giving up that part of the equity that you had owned.*** 2. The higher LTV (loan to value) rule. If the relative buying the so-called property also currently lives in the property, then they can go over the 85% threshold. The borrower would need a lease on the property and prove that they have lived there for 6 or months. This can be done by showing their driver's license, current utility bills, cable, etc, etc. Anything that can show 6 months of residence. And by doing this, the buyer will be able to utilize FHA's max financing programs.Best of Luck

Feb 15th 2012
0
0
Mark Wilkins (mwilkins)
#12 ranked lender in Pennsylvania - 7 contributions

Please do not go ahead and do an FHA loan. The cheapest and easiest way would be to do a Conventional loan with a 20% gift of equity and sellers assist. I grew up in Langhorne right across from Styers Orchards and do a lot of business in the area. If you would like to set up a meeting I could meet with you and your Mom and assist with putting together the sales contract. I also have conections with all of the settlement companies in the area. Please give me a call or email me at any time. Mark Wilkins 215-378-9272 mwilkins@capitalfmc.com

Feb 15th 2012
0
0
Mark Wilkins (mwilkins)
#12 ranked lender in Pennsylvania - 7 contributions

No Money down would be required in the scenario i just went over. All of the closing costs and downpayment would be in the loan amount.

Feb 15th 2012
0
0

I thank you all for your answers, it is very much appreciatedNow I have to find a reliable mortgage company to work with. Wish me lock!!!

Feb 15th 2012
0
0
Subscribe to our news feed.