Purchasing a home directly with one (or both) of your parents or your adult child (or children) is something that more and more people are seeming to do. By doing this, you make homeownership more affordable. It can also be helpful to those you may be caregiving to or supporting. This way of purchasing a home can become complicated. If this is something you plan to do, we would recommend you work directly with your mortgage broker, lender, or realtor so you are taking all the proper steps and precautions.
This way of living has become more popular in the last couple of years due to what is going on in the world lately. Many people have lost their jobs or need additional help, so living with a loved one can make things less stressful. It will offset costs that are involved.
If you are able to, purchasing a home with cash can make it easier on all parties involved. If you are selling a home as well, those funds can go right into purchasing a new home. If you are able to pool funds from the multiple parties involved, there will be a lot less “fine print” you have to deal with. Remember, you can have multiple names on a deed.
As we have mentioned before, you can have multiple names listed on a mortgage application. The co-borrower does not necessarily even have to plan to live in the home moving forward. Having multiple people on the application make it easier for someone to qualify for a loan. You are pooling multiple sources of income together. If you do not want to have a co-borrower, you can have a co-signer. A co-signer will not have any rights to the home being purchased but they will be responsible for making payments.
A cash gift is also an option. The gift can be applied toward anything related to purchasing a home.
Multi-generational homes can be a great idea for many different circumstances!