Posted on: 24th Jan, 2007 11:41 pm
hi need suggestion from you guys.
last three years ago while i was still in college, my aunt sell her house to my family and so she could move off to florida. at that time i was still in school so i may not qualify to take loan yet. plus my parent are receive ssi. but we do want to own a house. she sell the house for 100,000. but the mortage that she owed to the bank was 56,000. since i am not quality to buy a house yet, what we agree was my family will continue to pay all the mortage after her. she said when i graduate and ready to put under my name, she suggest to get a loan whatever the amount that left in the morgage. and paid the rest of the money later. since then my family manage to paid all the mortage without any problem. inow i want the property under my name.
but the problem is i just graduate and just got a job, until now it is only three month, my salary is 33,000. i check my credit score the other day is above 700. i wasn't sure if the bank allow me to borrow the money or not. the house value is now 179.000. since i paid the mortage for three years, it get lesser. but since i want to pay back her all the money i was thinking about to loan around 90,000.
the question is should i take a loan and buy a home from my aunt as a gift of equity or should i do a quit claim deed?
last three years ago while i was still in college, my aunt sell her house to my family and so she could move off to florida. at that time i was still in school so i may not qualify to take loan yet. plus my parent are receive ssi. but we do want to own a house. she sell the house for 100,000. but the mortage that she owed to the bank was 56,000. since i am not quality to buy a house yet, what we agree was my family will continue to pay all the mortage after her. she said when i graduate and ready to put under my name, she suggest to get a loan whatever the amount that left in the morgage. and paid the rest of the money later. since then my family manage to paid all the mortage without any problem. inow i want the property under my name.
but the problem is i just graduate and just got a job, until now it is only three month, my salary is 33,000. i check my credit score the other day is above 700. i wasn't sure if the bank allow me to borrow the money or not. the house value is now 179.000. since i paid the mortage for three years, it get lesser. but since i want to pay back her all the money i was thinking about to loan around 90,000.
the question is should i take a loan and buy a home from my aunt as a gift of equity or should i do a quit claim deed?
Jennisa,
Your aunt has already sold the property to your parents. By doing so, she has given up all your rights on the property.
Now, it's your parents' property and you can either buy it from them or just do a quit claim deed and transfer it to your name.
Discuss this with your parents. If they are willing to sign over a quit claim, its fine. You need not pay a purchase price then. But you need to record the deed at the county recorder's office.
Your parents may be bothered about the gift tax they"ll have to pay if they quit claim. But then there is also an exemption limit on the tax. So, talk to your parents and find out what they"ll prefer - a quit claim deed or a sale of the property.
Your aunt has already sold the property to your parents. By doing so, she has given up all your rights on the property.
Now, it's your parents' property and you can either buy it from them or just do a quit claim deed and transfer it to your name.
Discuss this with your parents. If they are willing to sign over a quit claim, its fine. You need not pay a purchase price then. But you need to record the deed at the county recorder's office.
Your parents may be bothered about the gift tax they"ll have to pay if they quit claim. But then there is also an exemption limit on the tax. So, talk to your parents and find out what they"ll prefer - a quit claim deed or a sale of the property.
hi, alex
thanks for the advice. actually the properly was still under my aunt name. since now i had a stable job hopefully i would not have any problem with the lender. but i heard that one should refinance in order to have a full ownership of the house. does it necessary? will it be worth it since now the amount that left from the mortgage is less than 50,000.
thanks for the advice. actually the properly was still under my aunt name. since now i had a stable job hopefully i would not have any problem with the lender. but i heard that one should refinance in order to have a full ownership of the house. does it necessary? will it be worth it since now the amount that left from the mortgage is less than 50,000.
Welcome Jennisa,
Well, if the property is still in your aunt's name, then you need to get it transferred in your name. I think your aunt should have at the time of sale signed over a quit claim to transfer the title to your parents. They have actually paid for the sale.
Anyway, now that you wish to refinance, that is, take out a loan to repay the existing one, it's better to get the title in your name. It is necessary that you have your name on the title.
The concept of more than one owner in case of refinance exists when
co-owners borrow together. But in your case, you are the only borrower. So, you need to do a refinance and change the title at the time of settlement.
Well, if the property is still in your aunt's name, then you need to get it transferred in your name. I think your aunt should have at the time of sale signed over a quit claim to transfer the title to your parents. They have actually paid for the sale.
Anyway, now that you wish to refinance, that is, take out a loan to repay the existing one, it's better to get the title in your name. It is necessary that you have your name on the title.
The concept of more than one owner in case of refinance exists when
co-owners borrow together. But in your case, you are the only borrower. So, you need to do a refinance and change the title at the time of settlement.
That's absolutely fine Jennisa,
If I can help someone, then I"ll surely feel happy about it.
It's good that you have a stable job and your credit score is also appreciable.
You need a loan amount worth the balance of the mortgage that you need to pay. A refinance for that purpose will be beneficial if you can qualify with a suitable lender offering you an interest rate lower than what your parents have been charged for the existing loan.
Hope you clear the dues soon.
Best of luck
If I can help someone, then I"ll surely feel happy about it.
It's good that you have a stable job and your credit score is also appreciable.
You need a loan amount worth the balance of the mortgage that you need to pay. A refinance for that purpose will be beneficial if you can qualify with a suitable lender offering you an interest rate lower than what your parents have been charged for the existing loan.
Hope you clear the dues soon.
Best of luck
Hi Jennisa,
You can refinance right away. The loan provider will definitely ask you whether you are going for a home purchase, home improvement or refinance loan.
Your aunt may sign a quit claim deed to convey you the property and then you may refinance. Or else, you may find a suitable lender, tell him your situation and qualify for a loan against the property. And, at the time of settlement when you sign the loan papers, you can directly change title from your aunt to you. The lender will then hand over the cash to you.
You can then pay off the existing loan and start making payments for the refinance loan.
Thanks,
Sara
You can refinance right away. The loan provider will definitely ask you whether you are going for a home purchase, home improvement or refinance loan.
Your aunt may sign a quit claim deed to convey you the property and then you may refinance. Or else, you may find a suitable lender, tell him your situation and qualify for a loan against the property. And, at the time of settlement when you sign the loan papers, you can directly change title from your aunt to you. The lender will then hand over the cash to you.
You can then pay off the existing loan and start making payments for the refinance loan.
Thanks,
Sara
since my since still have the mortgage left only 50,000. i think it is not gonna worth it to refinance. as i search through forum it stated that to had a full ownership throu quit claim deed one must either refinance or novation. so it if i don't want to refinance i had to do a what call a novation? i am right.
and i still have right to additional loan?
thanks.
and i still have right to additional loan?
thanks.
hi jennisa,
you can take out an additional loan in the form of home equity loan or line of credit. it will be offered against your home equity (property value - amount repaid till now).
regarding novation, well it is a process by which you can transfer a loan to some other person. to get full ownership through quit claim deed, one need not do novation. this process will only help you to take your name off the loan; it has nothing to do with ownership rights.
you can do one thing; ask your aunt to quit claim the property to you and then do a novation to transfer the loan in your name. then you can apply for an equity loan using which you can pay off the existing loan.
hope you find this information useful.
god bless you.
samantha
you can take out an additional loan in the form of home equity loan or line of credit. it will be offered against your home equity (property value - amount repaid till now).
regarding novation, well it is a process by which you can transfer a loan to some other person. to get full ownership through quit claim deed, one need not do novation. this process will only help you to take your name off the loan; it has nothing to do with ownership rights.
you can do one thing; ask your aunt to quit claim the property to you and then do a novation to transfer the loan in your name. then you can apply for an equity loan using which you can pay off the existing loan.
hope you find this information useful.
god bless you.
samantha
To avoid any problem, is a gift of equity appropriate?
Are you thinking of buying the property from your aunt? But as far as I have understood from your posts, it is already sold to your parents but the deed still has your aunt's name on it. So, I feel that you should change the names on the deed.
Anyway, a gift of equity is a part or whole of the equity in your home, that is, the difference between your home value and the amount you owe on it. If your aunt gifts you a part of the home value, then she will be receiving a lower amount of money from you as the sale price.
Most lenders accept the gift of equity as a part of their loan transactions.
Anyway, a gift of equity is a part or whole of the equity in your home, that is, the difference between your home value and the amount you owe on it. If your aunt gifts you a part of the home value, then she will be receiving a lower amount of money from you as the sale price.
Most lenders accept the gift of equity as a part of their loan transactions.