Home Buying in 52806>Question Details

Artymowski, Both Buyer and Seller in 93060

Hello, I own a house that I want to sell. I have a very good friend I would like to sell it to. Can I sell it to him and co-sign the loan with him?

Asked by Artymowski, 93060 Mon Feb 18, 2013

He has a good job, but has only worked there three months. He would qualify otherwise.

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3
I agree with Paul's answer that you would have to own the home outright probably before that would be possible and the lease with the option to purchase would probably be the best bet for now for you both. Definitely consult your attorney on these types of documents.
0 votes Thank Flag Link Tue Mar 26, 2013
If you own the home outright (that is without a bank mortgage lien attached to it) you could sell it to your friend on contract.. This would involve determining a set sale price, set annual interest rate, and other terms of sale.. for a fixed period with the option for your friend to obtain a conventional loan.

It would be a good idea to have your attorney draw up the contract for sale in order to satisfy all the legal requirements of a contract sale and purchase.

You would then collect the payaments, provide the purchaser with an annual interest statement, and report the interest received as income on your tax returns.. (see you CPA or accountant for details.)

If you still currently have a mortgage loan on the property, you could not sell the home on contract due to the fact that your mortgage lender could call the loan due on demand becasue of your title status transfer.

Or, you could turn the home into a rental property and rent it to your friend until he can qualify for a loan. (Remember, there is no such thing as "Rent-To-Own"... The correct term is lease with the option to purchase).

Hope this helps.
0 votes Thank Flag Link Sat Mar 9, 2013
This may not be doable; however the lender can make the call. I would suggest you or your friend discuss this with the lender and see what options you have. A local lender may be your best bet for some flexibility.

Cheers!
0 votes Thank Flag Link Mon Feb 18, 2013
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