Can a home seller help a home buyer with a down payment by paying rent?
Normally, if a home seller helps a home buyer with a down payment, the bank wants to know about it, and will count it against the home buyer when approving the mortgage. But what if the home seller agrees to rent the house back from the home buyer, and pay the rent in advance? Is that a loophole that lets a home seller help a home buyer with the down payment without having the bank count it against the home buyer when approving the mortgage?
Asked By: x4294967296 - 9/24/2009
Best Answer - Chosen by Asker
No, I assure you this scenario wouldn't even be submitted to the mortgage underwriter. It just doesn't fit... More
Answered By: Carol - 9/24/2009
Additional Answers (4)
The bank isn't going to buy your logic. Worse, you will create paperwork that looks like taxable income to the buyer.
Answered By: v b - 9/24/2009
That would be legal according to mortgage laws. Contract law and rental laws may differ depending on area. The seller could also legally "purchase" a $5000 pencil from the buyer, prior to the home sale.
Answered By: Synful Visions - 9/24/2009
I don't think so. First, when you apply for the mortgage you will not yet be entitled to collect rent since the seller is the owner. It also would put it into the category of rental property, which is not attractive to lenders right now. They'll want to see that any money you are counting on has been in the bank for... More
Answered By: doinou - 9/24/2009
Your mortgage would then be classified as non-owner occupied which no mortgage companies are doing these days. It's considered rental property & rates are higher and so is the down payment if you do find someone to do the loan,.
Answered By: Beverly S - 9/25/2009
Over 483 Local Jobs Now Hiring In Your Area. $18-$87/Hr - Apply Today!
Jobs hiring now near your local area. Find a job and apply now.
No Fees! Apply To Become A Mystery Shopper! No Contracts, No Hassle
Take Accredited Classes Right From Home. Free Video Will Explain All!
Other Career Questions
Do most mechanical engineering jobs offer job security?
What is your current job? Why did you choose this job? What do you enjoy about your job? What do you dislike about your job? What would be your perfect job? Would you rather have this j...
Where are the jobs? Is productivity and globalization creating a permanent “recession” of jobs? My main issue is I am doing a paper for school and have no idea where to begin. I was hoping suggestions...
Content is not owned or controlled by Monster. Any content concerns should be addressed with Yahoo!
Yahoo! Does not evaluate or guarantee the accuracy of any Yahoo! Answers content. Yahoo! Disclaimer.
Best-Paying Work-from-Home Jobs
It’s easier than ever to work from home. Of course, not every job is a mobile job, and some companies aren’t interested in having their employees work from home.
2013 Marketing Jobs Outlook
The US may be facing another year of anemic hiring overall, but that won't be the case in the high-orbit world of multichannel, digital media marketing.
2013 Engineering Jobs Outlook
Engineers will find job opportunities in select disciplines in 2013, with candidates who are all-around, client-oriented businesspeople in demand.
Best-Paying Jobs by Major
What could you earn with a particular four-year degree? Find out by checking out this list of the top-paying jobs for 20 of the most common majors.
Eight High-Paying, Secure Jobs
Want to earn a good salary and enjoy a measure of job security as well? Check out these well-paying jobs on tap for fast growth in the coming years.