With people living longer in general, there are fortunately some opportunities for family members to assist one another in certain potentially dependent situations. This is not a widely-publicized program, but it can be a life saver and offer some tremendous opportunities.
Fannie Mae allows a relative to purchase a home for elderly or disabled family members. (FHA has a similar program, but as we’ve said in the past….sometimes a conventional loan can sort of trump an FHA loan when it comes to pros and cons.)
However, this can really be the ideal solution for families who may not necessarily want/need to live under one roof.
Besides the regular mortgage-type disclosure stuff, some of the stipulations include:
§ The property must be the relative’s primary residence; this program doesn’t extend to a vacation getaway with ocean views!
§ A 5% down payment
§ The primary borrower does not have to occupy the property if:
o They are the parents who want to provide housing for their physically handicapped or developmentally disabled adult child (the parent would be considered the owner/occupant)
o It is the child who wants to provide housing for his or her elderly parents (the child would be considered the owner/occupant)
At the end of the day, there are pluses and minuses when it comes to any financing solutions like this one (particularly when family is involved!), but this mortgage product may well be worth a look and could offer the best of both worlds to family members requiring support and to those who love them.
Give me a buzz for additional details or if you have any questions!