Home Buying in Cherry Hill>Question Details

John Sabol Ii, Other/Just Looking in Bloomfield, NJ

Down payment help from in-laws.

Asked by John Sabol Ii, Bloomfield, NJ Sat Aug 24, 2013

I currently live with my in-laws in a their two-family home. We would like to buy a mother-daughter home but my wife and I need help with the down-payment. My in-laws said they will give us money for the down-payment from the sale of the the house we all live in. I keep trying to understand how can you give us money for a new home if you have to first sell the home we are in. Am I missing something? Is there a way this could be done?

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Answers

8
A sale contingency on a property you own is less complicated than a contingency for gift proceeds.

Not an easy one, but possible. You may need to talk with a few lenders to find one that can do this workaround. Who will live in the 2nd family unit? Your income may need to be able to cover the entire mortgage or at least most of it. Lenders usually won't count all of anticipated rent from that unit as income toward making the mortgage payment.

It's really worth your while to speak to a few lenders and understand the price point at which your income will allow you to purchase.
1 vote Thank Flag Link Sat Aug 24, 2013
Deborah Madey, Real Estate Pro in Red Bank, NJ
MVP'08
Contact
Gift from relatives are allowed for all loan programs in your particular case. The only program that has restrictions is Conventional. For this Conv financing, the borrower MUST have 5% their own funds, but after that, the Gift Donor can gift an unlimited amount of funds to cover an increased down payment and closing costs. FHA on the other hand does not restrict the Gift. The Donor can gift all the down payment and closing cost providing the Gift Funds can be sourced. Let me know if you require any assistance by clicking my profile.

Best of Luck!
Web Reference: http://www.AFN-Loans.com
1 vote Thank Flag Link Sat Aug 24, 2013
No, you are correct, they will either need to sell their home first and then they may"gift" you the money or if they own their home outright or have sufficient equity, then they could list them home and at the same time take an equity line of credit against it and gift you the down payment from the equity line. I would suggest sitting down with a local mortgage lender and your in-laws and explore their options.
0 votes Thank Flag Link Sat Sep 14, 2013
You are correct, the current home must be sold first. You should consider using the NJHMFA Smart Start Program or look other Down Payment Assistance (DPA) programs if you would like to purchase before your inlaws home sells. Call me if you need more info
0 votes Thank Flag Link Sat Sep 14, 2013
If they own the home out right they might be able to take a home equity loan , give the the money and satisfy the home equity loan when they sell the home. Speak to you mortgage person and or the local bank for more information
Good luck
0 votes Thank Flag Link Wed Sep 11, 2013
I have a great lender that I work with who should be able to help you. Give me a call and Id be happy to pass along your information to him.

Thanks,


Samuel Rifkin
REALTOR®
609-315-9119
Email: SamSellsNJ@gmail.com
http://www.SamSellsNJ.com

The Rifkin Team
Keller Williams Realty
0 votes Thank Flag Link Mon Aug 26, 2013
The purchase of the new home would be contingent upon the sale of the current home. You would literally leave one closing with a check and go to the next closing.
0 votes Thank Flag Link Sat Aug 24, 2013
Talk to a banker - will likely create a home sale contingency to get the mortgage. A sharp attorney will want to get any gift money into the deal early to avoid this very thing.

Good luck and best,
Jeanne Feenick
Unwavering Commitment to Service, Unsurpassed Results
0 votes Thank Flag Link Sat Aug 24, 2013
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