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jfink46
297 Posts |
 Posted - 06/11/2008 : 2:23:11 PM
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This is a scenario I added to another post, but I thought I would start a new one that is FHA specific.
Parents are currently renting a house to daughter and son-in-law that is worth about $450K and has a $275K loan on it. The parents want to get about $90K out of the deal and give the rest of the equity as a gift to the kids. The kids would then get a $370K FHA loan based on a sales price of $450K with the $80K down payment coming from a gift of equity from the parents (sellers).
Will this fly FHA? |
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lukeallison
1409 Posts |
Posted - 06/11/2008 : 2:36:29 PM
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| Yes - that should work fine. As long as the loan amount is within county limits. |
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jfink46
297 Posts |
Posted - 06/11/2008 : 2:39:03 PM
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| County limit is $400K, so that works... |
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moneyluck
3775 Posts |
Posted - 06/11/2008 : 3:24:13 PM
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| you might run into "identity of interest" caps at 85ltv. do you have rent checks for the occupants to the folks? |
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jfink46
297 Posts |
Posted - 06/11/2008 : 3:25:42 PM
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| Don't know yet about the checks. My LTV is under 85% in the above scenario, so I think I'm fine, right? |
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EquitySmart
1240 Posts |
Posted - 06/11/2008 : 3:31:18 PM
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| Yes, you should be fine. You would only need the checks for LTV higher than 85% |
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moneyluck
3775 Posts |
Posted - 06/11/2008 : 3:46:30 PM
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quote:
Originally posted by EquitySmart
Yes, you should be fine. You would only need the checks for LTV higher than 85%
haha. yeah, i read too fast, sorry. Apparently, I can't calculate ltv. :) |
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ladysammm
352 Posts |
Posted - 06/11/2008 : 6:00:43 PM
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Hi, your scenario would work fine. it is common from parent to child. If you would like further help with your file I would be happy to assist you. We are Assurity Financial Services and we lend in Nv and FHA is our niche. If you have an approve/elgible we dont have fico min scores. if you receive a refer then their is a 580 min score.
pam.kirchner@assurityfinancial.com Wholesale AE 23 years FHA experience
702-418-4818 direct www.assuritywholesale.com
FHA The Assurity Way |
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Mandyvilla
3453 Posts |
Posted - 06/11/2008 : 6:09:20 PM
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| Only caution is mom and dad cannot co-sign on the loan. If that is not needed, you have a perfect gift of equity. Mom and Dad can even pay all closing costs up to 6%. |
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nutesch
498 Posts |
Posted - 06/11/2008 : 9:41:39 PM
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If the credit scores are good, save your clients the hassle of FHA and go Conventional. TBW allows Gift of Equity from an immediately family member if the LTV is 80% ore less and the gift is 20% or more. Seller can pay up to 6% in concessions and you'll save your borrower the FHA Up Front MIP / MI. I just closed one with them last week and it was a breeze.
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