Joint mortgage?

[Anonymous]

In a recent conversation with my nephew, we wondered if it was possible for our 2 families to join forces to buy a condo at the beach.  Not that it could happen anytime soon, just curious how that would work or even if it could.

If we wanted to combine resources to buy a beach condo whose credit do they pull?  We would have 4 individual incomes, 2 from my house, 2 from his.  Would it be the middle score of both families, and then lowest of of those 2?

Anyone knows how that works?  Or will it not fly at all?

[Anonymous]

I'll start by saying this sounds like a bad idea... Sharing a house with multiple parties rarely ends well.

They will use the lowest middle score of anyone going on the loan. 

I know there's a limit on non-occupant buyers (co-signers) but I'm not sure there's a limit on occupant buyers.

[Anonymous]

You're right, not a good idea to mix family with business.  It was kicked around we'd share every other month to do as you please.  Vacation with family and friends, or If you wanted to rent any part of your month out, you'd keep that income.   

I'd be concerned if one party wanted out 10 years later, or wanted to sell out to someone I didn't agree to.  

[StartingOver10]

Agree with the others, it is more complex than it sounds like it should be.

There is a way to do this though if you really want to persue it, have an agreement (contract) regarding the terms of use and buyout before you enter into a purchase. Something like a simple joint venture type contract. You would specify ownership interest and how to accomplish a buy out. It can get complex, even if you all agree.

Also, you can set up a trust if you desire - that might help. Although some mortgage co's won't finance a trust.

[Anonymous]

So what would be the purpose of a trust?

[DallasLoanGuy]

Yes, it is possible.

You can have as many borrowers as you want.

People do this to buy vacation properties around ski resorts.

Complicated paperwork on the loan officer's end..... but pretty straight forward for all borrowers.

[StartingOver10]

Here is a good explanation in this link, but a better person to talk to is your attorney and your CPA

http://www.nolo.com/legal-encyclopedia/free-books/avoid-probate-book/chapter7-7.html

check this link too https://www.sorted.org.nz/a-z-guides/family-trusts

[Anonymous]

Thanks for that info.

Say my nephew and I do this, which one of us writes the payment check each month?  Do they take my half from my account and half from his?

[StartingOver10]

If it were my property and I owned it jointly with any other person I would have a separate account set up for payments for this loan. That you you would put in your half into the account and your nephew would put in his half and then the mortgage is paid from the separate account. The account would be titled as a trust if you hold the property in trust or titled with however you are holding the property. 

You don't have to do it that way, but it is much easier to track payments and keep records IMO.

[masscredit]

This sounds simular to what I've been thinking about lately. My girlfriend and I have been discussing moving in with eachother. Renting a house would pretty much cost the same as a mortgage payment. I currently live in a recently deceased family member's home that will be for sale soon. I really like the home and am considering finding a way to try to buy it.  I'm thinking if we go this route, maybe we should set up a seperate entiity/trust that will spell out what happens if one person would like to get out of the deal at some point.