Quote:
Originally posted by photon@Aug 26 2004, 05:31 PM
Alright say you have two parties, A and B.
B wants to buy a house but doesn't have the down payment. B has some cash and is willing to invest in B's house by providing the down payment. B doesn't want a monthly payment or anything, just a return on investment when the house is sold or equity taken out of it.
What's a good arrangement that would be fair to both sides? I'm involved on one side and family is on the other side so it's hard to come up with a solution that is fair and equitable to both sides.
Any input?
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I agree with Calf. You need to edit your post!!
"A" wants a house and has no money, just the ability to pay a monthly payment.
"B" has money for a downpayment, but doesn't want monthly payments.
Therefore "B" issues a personal loan to "A," signed and documented with an agreed upon interest rate and term, with the house as collateral. In other words, if "A" misses a set number of payments on the loan to "B," then "B" might be able to force sale of the house to recover his money OR he is given some form of ownership in the house.
Something like that.
Don't lend money to relatives without putting it in writing with some collateral. There's about a 50% chance you'll never see it again if its risk free to them.
The other option is for "A" to show some patience and save enough for a down payment. Or buy a condo for $5,000 down or something.
Just thinking out loud.
Cowperson