Personal loan for downpayment?

[jnc]

My husband's boss made a casual offer a few years back, to help us with a downpayment on a home.

We weren't ready at the time so we didn't get any further into it but now that we're thinking more seriously about home buying, we are considering this.

I am assuming that what he is offering is an interest free loan.

So, my question is this. . . Will the mortgage companies allow this type of help with a downpayment? I realize the payments would have to be considered in our monthly debt and would effect how much we could borrow.  But, is it even allowed? 

If we want to go ahead with a purchase in the near future, we have to either consider this option or a down payment assistance program or a usda loan w/ no dp.  I am not opposed to the assistanace, except that it increases the interest on our primary loan.

Anyone know if this ccould work?

Thanks,

-Christine-

[ezdriver]

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@jnc wrote:

My husband's boss made a casual offer a few years back, to help us with a downpayment on a home.

We weren't ready at the time so we didn't get any further into it but now that we're thinking more seriously about home buying, we are considering this.

I am assuming that what he is offering is an interest free loan.

So, my question is this. . . Will the mortgage companies allow this type of help with a downpayment? I realize the payments would have to be considered in our monthly debt and would effect how much we could borrow.  But, is it even allowed? 

If we want to go ahead with a purchase in the near future, we have to either consider this option or a down payment assistance program or a usda loan w/ no dp.  I am not opposed to the assistanace, except that it increases the interest on our primary loan.

Anyone know if this ccould work?

Thanks,

-Christine-

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Down payment money cannot be loans of any type. Down payment money may be gifted ... but must be gifted by QUALIFIED donors.

[jnc]

Okay. That's what I feared.

Thanks!

[Anonymous]

I've read that personal loans can be used as long as they are seasoned for a few months (3-6). So you could theoretically get the loan now, start paying it off, and let that cash just sit in your account.

[jnc]

Thanks, I will look into that since I still have some time

[sports1965]

If u have to borrow money for the down payment then u not ready to buy a home.

[ezdriver]

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@Anonymous wrote:
I've read that personal loans can be used as long as they are seasoned for a few months (3-6). So you could theoretically get the loan now, start paying it off, and let that cash just sit in your account.

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Please source that information because it is illegal to use borrowed funds for downpayment on home purchases....no matter how long the funds have been sitting in one's account. If I'm wrong, show me.

[jnc]

Then why do 0 downpayment loans exist? And down payment assitance?

Serious question.

-C-

[ezdriver]

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@jnc wrote:

Then why do 0 downpayment loans exist? And down payment assitance?

Serious question.

-C-

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There is no law against financing 100% of the purchase price. There is for using proceeds of a loan as downpayment. Apples and oranges.

Downpayment assistance programs offer GRANTS...not loans.

[jnc]

Sorry, that question was in reply to the person above you. Apparently we posted at the same time.