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Must a second home I buy for another family member be considered an investment?

I am relocating and buying a home.  IN addition, I want to buy a home for my disabled daughter nearby.  I have been preapproved for purchase of a principle residence and have adequate assets to purchase another property.  My bank is not giving mortgages for investment properties.  Will the interest be higher?  Are there other differences?
  • October 05 2012 - Town of Yarmouth
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Answers (4)

Profile picture for doug132
I recommend talking with another lender. Jack Hienzman at RMS is fantastic. You may also want to talk with an accountant about tax implications. That might steer you in a different direction. Good luck to you, Doug
  • October 06 2012
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You can purchase the second home with your daughter. it can be owner occupied; her as the borrower and you as the non occupant co-borrower.  Both of you would be on the deed. Depending on her credit and income she could be on the Note, but does not need to be.
  • October 06 2012
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Perhaps you would be better off seeking the services of a mortgage broker.  Often "a bank" has limited products.  If you do not exactly fit their mold they reject or refuse to consider your loan.

Mortgage brokers deal with many banks or lenders. Some may be less restrictive than the bank you are dealing with now.

 Your circumstances are unique inasmuch as you are providing housing for a disabled family member. 

Hopefully a mortgage broker on Zillow will give you some guidance or be able to refer you to someone who can help you.

Don't give up on the first rejection.   Good Luck
  • October 06 2012
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The home you buy for your daughter will be considered an investment property. The interest rate will be higher and depending on the lender, you will need 20-25% down. 
  • October 06 2012
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