Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I have what I think is a unique situation, and could not find advice on the internet for my specific question.
My in-laws and my family are moving into the same neighborhood. We are planning to buy a home we can both live in while they build a house on a lot they have purchased. Once their house is complete, they would move out, and we would take over the mortgage. Is their anyway to avoid closing costs when we "take over" the mortgage, i.e buy the house from them? What options do we have - basically whats the cheapest option?
Timeline of the events.
1. In-laws sell their current house.
2. They purchase the house that we will live in together.
3. We sell our house.
4. Live together until their house is built.
5. They move out.
Note: We cannot buy the house initially, my in-laws have to.
You've mentioned a timeline, but you haven't said anything about your timeframe. If you can sell your houses nearly concurrently, that may help your situation.
You should still explore the idea of you purchasing the house initially. Perhaps your in-laws could supply the down payment to enable you to be the initial purchaser. That would seem a lot simpler than doing two transfers--which might both be subject to transfer taxes and other closing costs.
You've mentioned a timeline, but you haven't said anything about your timeframe. If you can sell your houses nearly concurrently, that may help your situation.
You should still explore the idea of you purchasing the house initially. Perhaps your in-laws could supply the down payment to enable you to be the initial purchaser. That would seem a lot simpler than doing two transfers--which might both be subject to transfer taxes and other closing costs.
Thanks for the input. The time frame is unknown since its based on buying/selling homes.
I think we would put our house on the market right after my inlaws sold theirs...so maybe 1 month to sell?
We would live together for around a year.
I do agree that we might wait until we can put the down payment and purchase the house initially. Thanks again.
Is their anyway to avoid closing costs when we "take over" the mortgage, i.e buy the house from them? What options do we have - basically whats the cheapest option?
A lot of specifics are missing and if you care not to share PM me.
1) Why can't you buy the house initially
2) What will be different that you would you qualify to buy the house later?
3) Taking over a mortgage would be an assumable mortgage, that you'd have to still qualify for. It might not be the cheapest option.
You cannot just "take over a mortgage". You would need to purchase the property if you want the mortgage and house in your name. Otherwise, you can put the house in your name and still pay on their mortgage, but the tax paperwork will go to them. You'll have a harder time writing off the interest. Also, most mortgages have a "due on change" clause, so they might require the full payoff if the deed is changed. Most don't enforce this as long as payments are being made each month.
You also won't be an "arms length" transaction when you buy the house from them, so there will be other hoops to jump through there as well.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
