Multiple Owner Mortgage Questions

Anonymous · ‎03-25-2009

Hello,

I am looking to purchase a home with 2 friends. We would like to split it evenly if possible.

This would be a first home purchase for myself as well as one of the other members, but the third already owns a home.

We would definitely like to take advantage of the first time home buyer perks, so my first question is,

Is there any way for us to recieve the first time home buyers assistance if we were to equally split the house with a non first timer?

Or is there another way to structure the loan that would essentially do the same thing?

Also, it is my understanding that with a mortgage with multiple purchasers, each one is liable for the entirety of the house, is that correct?

Is there a way to protect each persons interest in the purchase, i.e. what is the best thing to do if one person wants to move out?

Thank you for any help!

Jesse

WannaHouse · ‎03-25-2009

@Anonymous wrote:
Hello,
I am looking to purchase a home with 2 friends. We would like to split it evenly if possible.
This would be a first home purchase for myself as well as one of the other members, but the third already owns a home.
We would definitely like to take advantage of the first time home buyer perks, so my first question is,
Is there any way for us to recieve the first time home buyers assistance if we were to equally split the house with a non first timer?
Or is there another way to structure the loan that would essentially do the same thing?

You will not qualify. everyone MUST be a 1st time homeowner.

Also, it is my understanding that with a mortgage with multiple purchasers, each one is liable for the entirety of the house, is that correct?

Is there a way to protect each persons interest in the purchase, i.e. what is the best thing to do if one person wants to move out?

The best thing in my opinion, is to buy out that person. So, if it's 3 of you, then the other two would each pay half to the departing person and buy them out. OR, maybe you would just refinance it with the 3rd one left out?

Thank you for any help!

Jesse

Message Edited by WannaHouse on 03-25-2009 10:40 PM

Kathy

We are finally homeowners!!

Closed May 5th-30 yr fixed at 5.25%.

Anonymous · ‎03-25-2009

what is the situation? Are the three of you looking to buy an investment property? If so, you may not get any credit anyway. I think it has to be primary residence (but I am not sure on this)

Also, if this is an investment thing, I think this is a bad idea. Getting 3 separate people involved on the financing of a purchase is a bad idea. This is even more true when it is an investment property and even more so when property values are sketchy right now. What happens when one runs into trouble and either demands it be sold (which is not always possible), demands to be bought out (which you may or may not be able to do), or defaults on his part of the deal. The whole addage of not mixing friends and family with business is there for a reason. Also, who controls the purse strings and the major decisions. Alot of times when things come up, there may not be time for a conference to decide things. Someone would have to be "the person" in charge of it and the other would have to agree to it for it to likely work (think silent partners). I personally would only get involved in a situation like this if the deal was cash and all 3 parties put aside a reserve fund for repairs or items with each partner getting a monthly statement of expenses (w/receipts) and a balance on the reserve account. Also, again, although major decisions would get discussed across the board, 1 person would deal with the property. If ti is a rental, there has to be 1 contact, etc...

Anyways, this sounds like a very risky venture and way too many friendships end up in ruins over deals like this. IF the house is for you, then buy it yourself. If it is an investment and you do not have the cash for it, wait until you can afford it or can finance it yourself. That is just my opinion of course, no hard feelings meant.