Helping Your Family with Their Home
With your aging parent now living on social security income and your college bound teen ready to launch, it’s easy to feel the pressure of your family situation. Each of these loved ones need a nice little place to call home. How can you help? By utilizing the Family Opportunity loan program.
The Family Opportunity Loan Program
This little known program will allow you purchase or refinance a home for your college bound son or daughter, your disabled son or daughter, or your elderly parent, and treat the property as if it were owner occupied, thus enabling you to obtain a better interest rate and a reasonable down payment.
You could qualify for this type of program if you have the following situation:
- College bound son or daughter residing in a one unit second home residence purchased by their parent(s).
- Adult children purchasing or refinancing a primary residence for elderly parent(s) who are unable to work or have insufficient income to qualify for a mortgage.
- Parents purchasing or refinancing a primary residence for a disabled son or daughter who are unable to work or have insufficient funds to qualify for a mortgage.
Here is an example of how I used this program to help a client this week.
After her father passed away a year ago, the family decided it was time for mom to move closer to her children and grandchildren. She found a cute two bedroom ranch just a few miles from her oldest daughter, Amy. With mom living nearby, Amy and her husband Tom can help mom with household chores such as lawn care and snow removal.
Mom’s income is enough for her to live on comfortably, but not enough to qualify for the mortgage payment. The mortgage broker told Amy she can purchase the home for her mom, but it would require a huge down payment and the interest rate would be substantially higher because the property would be considered as “non-owner occupied”. That doesn’t sound fair! This home is for her aging mother!
Enter the Family Opportunity loan. By utilizing this loan program, I was able to show Amy how she could purchase this home with a substantially lower down payment and the interest rate on the 30 year fixed rate mortgage would be exactly the same as if she were purchasing the home for herself. After showing the numbers to Amy and her mom, they realized this was perfect for their budget.
Now Amy’s mom is settled in her new home, the monthly payment is affordable, and they can easily spend weekends and holidays together as a family!
Do you have a similar situation? You can share your story by leaving a comment below.