FHA co-signing and residency requirement

[Anonymous]

I have a question but it's very confusing.  My husband and I will be trying to purchase a house.  The house in question is my mother in law's but due to her husband's death last month she no longer wants to live in the house.  Now if we have trouble qualifying for the house she has offered to co-sign on another loan for us, does this mean through this loan program she has to live in the house?

Thanks for any help.

Rebecca

Message Edited by llecs on 03-18-2009 11:19 AM

[ShanetheMortgageMan]

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@Anonymous wrote:

I have a question but it's very confusing.  My husband and I will be trying to purchase a house.  The house in question is my mother in law's but due to her husband's death last month she no longer wants to live in the house.  Now if we have trouble qualifying for the house she has offered to co-sign on another loan for us, does this mean through this loan program she has to live in the house?

Thanks for any help.

Rebecca

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Well she can't sell you the home PLUS be a non-occupant co-borrower on the new loan, she could only sell you the home.  If you have trouble qualifying for the home now, can you just move in/she moves out and you make the payments until you are able to qualify on your own?  Or can you use another family member to help co-sign for you (again doesn't have to occupy the home)? 

Message Edited by llecs on 03-18-2009 11:20 AM

[llecs]

Rebeccainla2009, I split off your post to form a new thread within Mortgage Loans to keep the prior post on-topic. I didn't change your post, but I had to change the subject line. With my vast limited knowledge on Mortgages, I changed it the best I could. If you'd like to change it, feel free to do so by clicking "Options" and then "Edit Message" to make any changes.

[Anonymous]

Oh that's fine, it was easy to find.    

[Anonymous]

I can't get a loan just yet because I haven't had my business in operation for 2 years, it will be 2 years in November.  It is a shame because I grossed 66k but still isn't good enough.  What I am going to try to do is do a lease to own where part or all of my payment will be credited toward the down payment if that is possible and then next January try to purchase it then.  Honestly I had no idea how on earth she was going to be able to both.  I wanted to wait until next year but I still had to try to see what we could do.  Somehow I'm going to have to come up with some kind of paperwork saying she can't come in when she wants to ...thanks for your help.

[ShanetheMortgageMan]

I'd be leery of doing the lease to own in a down market, as you don't want to lock in a price "today" that the home could not appraise for "tomorrow".  If home values were going up, then yes, because locking in a price today would be great as it'd prevent you from a price increase tomorrow, and lenders are fine if a home appraises over the sales price, but if it appraises under then lenders use the lower figure of the two.