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Answers (29)
- workabee
- Contributions:1030
As long as you're buying houses luv, get an extra one for me.
- Seth Robbins, "SethERobbins"
- Contributions:33
So the mortgage lender you spoke with was incorrect in that there are programs available that will finance up to 75% of a purchase on an investment property! So this is where the nice percentages come in to play! Keep in mind it is 75% of the value of the home so and example of this is simple: Home values at 200K so the maximum loan on this property would be 150K now if the purchase price is 150K then your money down would simply be to cover closing costs, but for sake of the example lets say the purchase price is 160K that is ten thousand more than the allowable loan limit so you would have to pay down the price till it was 150K also remember there are additional costs associated with a mortgage purchase here in PA! The transfer tax (sales tax on a purchase), title insurance, origination, recording, appraisal, inspection, along with escrow reserves which are your property taxes and homeowners insurance also! These can add up pretty quickly so in this situation you would at bare minimum have at least 15 to 18K in money set aside to place towards the purchase! The other option is to see if the seller will do a "seller concession" or "seller assist" which is a percentage like 3% that will help to pay down the closing costs of the loan!
It's not so much "loopholes" but in how you structure the purchase and debt to ensure the minimum $$ out of your pocket while achieving a great gift for your newlyweds!
You're welcome to contact me directly for clarity on this or to discuss further in detail!
It's not so much "loopholes" but in how you structure the purchase and debt to ensure the minimum $$ out of your pocket while achieving a great gift for your newlyweds!
You're welcome to contact me directly for clarity on this or to discuss further in detail!
- Pasadenan
- Contributions:21466
Still wondering what the actual "gift" decision was, ...
- Paul Mondello, "Paul Mondello"
- Contributions:2097
as for the others guys its time to grow up and stop fighting with eachother...
AG
It is understandable that you would get that impression, however some of us are simply aiming to slow down the subtle abuse of the system by a long time member on Zillow Mortgage Market Place.
Best wishes with the wedding.
- Andrew Adams, "203K Specialist"
- Contributions:9349
Rudi - you need to take a long hard look in the mirror.
- Rudi Hofmann, "LUXURY HOME LOANS CA"
- Contributions:7435
Antoine's Gonzalez
WELL - SAID!
Any more "Members of the Silent Majority"
Wish to share their "Feelings or "Thoughts" on This Matter?
Thank You For Sharing
I was fairly certain there are "Folks Out-There" that do not appreciate their "In-Boxes" filling-up with
This B.S.
Happy funding- Rudi
WELL - SAID!
Any more "Members of the Silent Majority"
Wish to share their "Feelings or "Thoughts" on This Matter?
Thank You For Sharing
I was fairly certain there are "Folks Out-There" that do not appreciate their "In-Boxes" filling-up with
This B.S.
Happy funding- Rudi
- anitainesgonzalez
- Contributions:5
thanks for all of those who actually tried to help me and answer my question.... as for the others guys its time to grow up and stop fighting with eachother... isnt there enough fighting in this world ..with out childish antics adding to it?
thanks
thanks
- Paul Mondello, "Paul Mondello"
- Contributions:2097
Portfolio Man..aka Rudi
At some point you decided that you had earned the right to take advantage of the system here at Zillow. When exactly was that?
Opportunist, pararanoid, sociopath, ignorant are words that come to mind here.
More to come..?
- Andrew Adams, "203K Specialist"
- Contributions:9349
I didn't ask the OP how much they had available for a down payment because they told us!
"my main concern is the down payment ... i could pay 5% even 10% but the 30%-35% is a killer"
@ Rudi do you even read the threads?
"my main concern is the down payment ... i could pay 5% even 10% but the 30%-35% is a killer"
@ Rudi do you even read the threads?
- Rudi Hofmann, "LUXURY HOME LOANS CA"
- Contributions:7435
Andrew- You also got 4 TUs for this:
"Random Rudi...... suppose they would need 35~40% down as well...which is a great solution for someone struggling to make a 10% down payment."
Same question as K presented to Clay. Many contributors gave far better responses with NO TUs.
Andrew- You have this all figured out, don't you? Make a Random Andrew- A random "Suppose" scenario which is just that.
And- Off-Topic. You were not responding to the OP. It was toward me, inappropriately. Why didn't you ask the OP if they only had 10% down? Why me?
This wonderful contribution got you 4 TUs and Clay got 4 TUs. When someone sees the Thumbs Up on your Zillow Profile Page - They must think WOW, this guy gives great answers.
You like to be HONEST. You have told me on several occasions you do not lie.
All those TUs on you profile - How many do you think you receive from posts like this compared to what they were meant to stand for?
What percentage should you deduct from the ones gathered by ZBC behavior?
Happy funding- Rudi
"Random Rudi...... suppose they would need 35~40% down as well...which is a great solution for someone struggling to make a 10% down payment."
Same question as K presented to Clay. Many contributors gave far better responses with NO TUs.
Andrew- You have this all figured out, don't you? Make a Random Andrew- A random "Suppose" scenario which is just that.
And- Off-Topic. You were not responding to the OP. It was toward me, inappropriately. Why didn't you ask the OP if they only had 10% down? Why me?
This wonderful contribution got you 4 TUs and Clay got 4 TUs. When someone sees the Thumbs Up on your Zillow Profile Page - They must think WOW, this guy gives great answers.
You like to be HONEST. You have told me on several occasions you do not lie.
All those TUs on you profile - How many do you think you receive from posts like this compared to what they were meant to stand for?
What percentage should you deduct from the ones gathered by ZBC behavior?
Happy funding- Rudi
- Clay Branch, "Georgia Loans"
- Contributions:7839
My bad Rudi, I suppose if it was disclosed to a lender upfront that the subject property was going to be occupied by people other than the mortgagor and the lender allowed it to be financed as their Primary Residence, then that is on them. Good luck with that.
Your insinuating comments about having more than one Zillow ID are insulting, I don't have time or interest in posting with any Zillow ID other than the one you are reading now.
Your insinuating comments about having more than one Zillow ID are insulting, I don't have time or interest in posting with any Zillow ID other than the one you are reading now.
- Rudi Hofmann, "LUXURY HOME LOANS CA"
- Contributions:7435
Clay- Does your Lien Holder provide anything in writing stating you are not allowed to have your grown children live with you in your Primary Residence?
Clay- I guess I overlooked. I know how diligent you are for helping folks with calculations and Guides. I could not find an Agency Guide stating Two Primaries are allowed for the Same Borrower. Would you be so kind to post that for us?
Clay- I know you are a Smart Man. But- What type of Unique Capacity do you have that you know this "rules out a Primary Residence status by any type of lender"
That is one heck of a lot of Lenders, isn't it?
How many lenders are there in my neck of the woods?
San Diego has how many Banks and Credit Unions?
How about LA?
And, San Francisco?
When we add this up for all Towns- Townships - Cities Across the Nation, Gee how do you Know That?
Or, was that just something Smart to say to gather the 4 TUs on just that post from your ZBC or maybe you also have several Alias like some others where Zillow does not recognize the IP?
It is amazing how you are also able to do this in a kinder manner than your other ZBC Members. I thank you for that.
Happy funding- Rudi
Clay- I guess I overlooked. I know how diligent you are for helping folks with calculations and Guides. I could not find an Agency Guide stating Two Primaries are allowed for the Same Borrower. Would you be so kind to post that for us?
Clay- I know you are a Smart Man. But- What type of Unique Capacity do you have that you know this "rules out a Primary Residence status by any type of lender"
That is one heck of a lot of Lenders, isn't it?
How many lenders are there in my neck of the woods?
San Diego has how many Banks and Credit Unions?
How about LA?
And, San Francisco?
When we add this up for all Towns- Townships - Cities Across the Nation, Gee how do you Know That?
Or, was that just something Smart to say to gather the 4 TUs on just that post from your ZBC or maybe you also have several Alias like some others where Zillow does not recognize the IP?
It is amazing how you are also able to do this in a kinder manner than your other ZBC Members. I thank you for that.
Happy funding- Rudi
- Pasadenan
- Contributions:21466
"What we did was set up a trust to own our family home- it wouldn't really matter if I lived there or not. When I take a dirt nap, the trust will still own the property, but my daughter will be the sole beneficiary, so she will really own it for all practical purposes. This might work for you." -
In most cases, a simple trust is not sufficient to avoid the estate taxes upon death. The trust is still part of the estate. For many "living trusts", the purpose is the "trust split" on the death of the first spouse, to create a "bypass trust" to essentially double the estate limit before taxes by having the limit apply to each separately rather than the stated limit of the last to die.
Fortunately, there is no estate tax presently, but this still is not a fully decided issue, and congress rushed through the "extension" of "no estate taxes" at the last minute in December 2010 as part of other tax relief extensions.
If one has a very large estate, it is still worth speaking with an estate planner, or at minimum, studying the tax laws that apply, and discussing potential impacts with IRS employees.
Of course another reason for using a "trust" is to avoid probate, but with lawyer fees, it is not necessarily less expensive to bypass probate.
In most cases, a simple trust is not sufficient to avoid the estate taxes upon death. The trust is still part of the estate. For many "living trusts", the purpose is the "trust split" on the death of the first spouse, to create a "bypass trust" to essentially double the estate limit before taxes by having the limit apply to each separately rather than the stated limit of the last to die.
Fortunately, there is no estate tax presently, but this still is not a fully decided issue, and congress rushed through the "extension" of "no estate taxes" at the last minute in December 2010 as part of other tax relief extensions.
If one has a very large estate, it is still worth speaking with an estate planner, or at minimum, studying the tax laws that apply, and discussing potential impacts with IRS employees.
Of course another reason for using a "trust" is to avoid probate, but with lawyer fees, it is not necessarily less expensive to bypass probate.
- Pasadenan
- Contributions:21466
"you can contirbute 5-10% of a down payment, I would suggest offing just that as a gift to your son and DIL. That is plenty generous in my book." -
What someone elses' opinion is on "generosity" really has little bearing on any specific giver or receiver. It is not clear the intent of what the original poster intends or wants to give, but it certainly is not our responsibility to "judge" whether it is "too generous" or not.
There is nothing wrong with an "annual" gift, or "monthly gift" either, if one chooses to do so.
What someone elses' opinion is on "generosity" really has little bearing on any specific giver or receiver. It is not clear the intent of what the original poster intends or wants to give, but it certainly is not our responsibility to "judge" whether it is "too generous" or not.
There is nothing wrong with an "annual" gift, or "monthly gift" either, if one chooses to do so.
- Andrew Adams, "203K Specialist"
- Contributions:9349
Random Rudi...... suppose they would need 35~40% down as well...which is a great solution for someone struggling to make a 10% down payment.
- Clay Branch, "Georgia Loans"
- Contributions:7839
Rudi, your post is interesting. I think you would find Agency loans would also allow for a 2ND Primary Residence if that was indeed the case, not just a portfolio lender. That's not what we are talking about here, the OP's son/family will be occupying this property which rules out a Primary Residence status by any type of lender regardless of how rich they are.
- Paul Mondello, "Paul Mondello"
- Contributions:2097
Thank you Portfolio Man...now back to our regularly scheduled program.
A G - do what Shapiro says. Cash is a simple and kind gift. Open an account to store the cash until they find a house...fold up an opening statement and put it in a wedding card.
...you should speak to 'at least' your tax guy before you proceed.
- Rudi Hofmann, "LUXURY HOME LOANS CA"
- Contributions:7435
anitainesgonzalez- You need to find a portfolio lender. We have portfolio lenders that lend on 2 primary residences for the same borrower.
Typically this is on loan amounts over $3,000,000. The typical borrower for this is a person in professional entertainment industry or professional sports industry.
If yours is not a high dollar non-conforming loan amount it may not be possible. Best- Rudi
Typically this is on loan amounts over $3,000,000. The typical borrower for this is a person in professional entertainment industry or professional sports industry.
If yours is not a high dollar non-conforming loan amount it may not be possible. Best- Rudi
- P_Guthmiller
- Contributions:12
What we did was set up a trust to own our family home- it wouldn't really matter if I lived there or not. When I take a dirt nap, the trust will still own the property, but my daughter will be the sole beneficiary, so she will really own it for all practical purposes. This might work for you.
- wayne lancaster, "funds2"
- Contributions:1177
A key question is whether your son and DIL can qualify (income- credit) but just need funds. If so a Gift of 10% would be more than enough for down payment and closing cost, and 5% would be enough if Seller paid all or part of their closing cost.
If they have credit issues that may mean you would need to buy property as investment and that would require 20% down payment.
- shapiroamg
- Contributions:3058
Since you can contirbute 5-10% of a down payment, I would suggest offing just that as a gift to your son and DIL. That is plenty generous in my book.
- wetdawgs
- Contributions:26854
You mention you wish to purchase a house for your son and his wife. Does this mean you put down the down payment and carry the mortgage, or simply get them started?
In another post you mentioned a recent bankruptcy. Is it possible your generous thoughts are premature relative to recovering from the bankruptcy?
In another post you mentioned a recent bankruptcy. Is it possible your generous thoughts are premature relative to recovering from the bankruptcy?
- Robert Dandi, "BobRealEstate"
- Contributions:74
Gifting the down payment maybe the best way to do avoid this 35% requirement.
- Pasadenan
- Contributions:21466
"my main concern is the down payment ... i could pay 5% even 10% but the 30%-35% is a killer" -
If it is not in your name, and the loan is not in your name, then it is an "owner occupied" purchase mortgage in your son's name, and it is not "your investment property".
You will need to give the down-payment gift enough in advance that the underwriter doesn't start questioning the source.
Of course you could "cosign", but that could cause other issues down the road. Keep your credit rating separate if you can.
You said "I", that implies no spouse? If no spouse, then your maximum gift per year to your son and future wife is about $24k instead of about $48k, without triggering the gift tax. Again, contact the IRS for IRS rules.
If you are planning on transferring assets to your son prior to your death, you need to do it systematically to minimize tax impacts. Of course, right now, there is no inheritance tax on an estate, but congress only extended that for about 2 years, and they still haven't made up their minds what to do after that. It could revert to everything over $1 million in the estate at time of death is taxable.
If it is not in your name, and the loan is not in your name, then it is an "owner occupied" purchase mortgage in your son's name, and it is not "your investment property".
You will need to give the down-payment gift enough in advance that the underwriter doesn't start questioning the source.
Of course you could "cosign", but that could cause other issues down the road. Keep your credit rating separate if you can.
You said "I", that implies no spouse? If no spouse, then your maximum gift per year to your son and future wife is about $24k instead of about $48k, without triggering the gift tax. Again, contact the IRS for IRS rules.
If you are planning on transferring assets to your son prior to your death, you need to do it systematically to minimize tax impacts. Of course, right now, there is no inheritance tax on an estate, but congress only extended that for about 2 years, and they still haven't made up their minds what to do after that. It could revert to everything over $1 million in the estate at time of death is taxable.
- Bela Vora, "Bela Vora"
- Contributions:23
Hello
It is true that if you bought the house for your son it would be an investment property - but the mortgage lender I work with would require only 20% down. There is also a possibility that if your son could be on the loan - you could get an FHA loan.
Please call me to discuss further details. My office is off rt 100 in Exton - my mortgage advisor and I will be happy to meet with you in person as well.
Bela Vora
[contact information removed by Zillow moderator]
It is true that if you bought the house for your son it would be an investment property - but the mortgage lender I work with would require only 20% down. There is also a possibility that if your son could be on the loan - you could get an FHA loan.
Please call me to discuss further details. My office is off rt 100 in Exton - my mortgage advisor and I will be happy to meet with you in person as well.
Bela Vora
[contact information removed by Zillow moderator]
- Amanda Thomas, "amandathomas"
- Contributions:177
Hi Anita,
FHA offers a 'Kiddie Condo' loan, which gives parents financing method to purchase a home for or with their adult children -- as long as your son and his wife don't already own a home, and providing your joint application qualifies. With the Kiddie Condo loan, you will have a very low down payment, a competitive interest rate, and can help your son and his wife build up their credit as well since it will also be in their name.
Ask your lender for information about this program. It would be a great option to seek out over a straight investor loan. :-)
Does this help?
FHA offers a 'Kiddie Condo' loan, which gives parents financing method to purchase a home for or with their adult children -- as long as your son and his wife don't already own a home, and providing your joint application qualifies. With the Kiddie Condo loan, you will have a very low down payment, a competitive interest rate, and can help your son and his wife build up their credit as well since it will also be in their name.
Ask your lender for information about this program. It would be a great option to seek out over a straight investor loan. :-)
Does this help?
- anitainesgonzalez
- Contributions:5
my main concern is the down payment ... i could pay 5% even 10% but the 30%-35% is a killer
- Pasadenan
- Contributions:21466
You are allowed to give over $11k per year to anyone you want, and so is your spouse, so you can give up to $44k per year as a couple to another couple without gift-tax liability.
So, you "gift" them the down-payment (do it enough in advanced so that it is "seasoned"). And then gift them the mortgage payments each year. (They still would need to qualify for the mortgage with their own income and credit ratings this way though).
Or, you buy it as a "second home", or "vacation home", and let them live there rent free, and then do a title transfer later (but this may trigger the gift tax).
The IRS is happy to answer questions... 1(800)tax-1040.
So, you "gift" them the down-payment (do it enough in advanced so that it is "seasoned"). And then gift them the mortgage payments each year. (They still would need to qualify for the mortgage with their own income and credit ratings this way though).
Or, you buy it as a "second home", or "vacation home", and let them live there rent free, and then do a title transfer later (but this may trigger the gift tax).
The IRS is happy to answer questions... 1(800)tax-1040.
i want to buy my son and his wife a house for a wedding gift
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