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staylor09 · Joined: 19 Jul 2011 Posts: 1 1.44 Dollars($)

My parents plan on selling their house within the next year. My parents just want to break even when they sell the house, and said I should look into taking over the mortgage which is about $2000 a month.
I receive student loans to pay for housing, food, gas, etc. while I'm in school and I also work. I have good credit and I have 3 reliable friends willing to sign rental contracts in advance, with my income along with renting 3 rooms out, and student loans, I would have more than enough to pay for the mortgage, utilities, and my car payment, car insurance, and phone bill.

Is it going to be impossible to sign the mortgage over into my name? My parents own a vacation property so they just want to sell this house and buy something really cheap until they retire and move to the vacation property (and if they just rented the house to me, they wouldn't qualify for another mortgage).

Thank you so much in advance, let me know whatever details I need to add.

gmakerley · Posted: Tue Jul 19, 2011 12:22 pm Post subject:

ST, this is a difficult situation. Your student loans won't be considered as income by any lender, and your three friends wouldn't be paying "rental" income but instead it would be "boarder" income. Now that's a fine line, but it's a single family home, I'm guessing, so you can't truly "rent" it out other than as a complete home.

You would be wise to try to find out if you can assume the existing mortgage...still a tricky thing to accomplish given your lack of true income. That's the easiest method by which you might be able to absolve them of their payment load. Bear in mind, though, that a lender they visit for the proposed purchase of that "really cheap" home might not look at it in the way you would like.

Check with the existing lender first and see what options they might offer to you...maybe they like your parents enough to do all that you want to do...it's a doubtful premise, but worth the investigation.

chrisgummerson · Posted: Tue Jul 19, 2011 4:07 pm Post subject:

If you can make the mortgage payment with your 3 friends, then why dont you have them move in, and sign rental contracts. If you have 30% equity in the home, then your parents can use the income from rents to offset their expenses. Using the student loans, is not actual income as George touched on. FHA does allow boarder income, but you would not qualify based on the student loan income. Renting the home would be your next best option.

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