Can i have my parents house redeeded in my all our names then refinanced in order to avoid the 20 down?

Clair
I went to a "financial firm" about the best approach to purchase my parent's house. I have been renting the house for several years and the house has a mortgage on it in my parent's name, NOT mine. They are claiming that if I have the house deeded in ALL our names, then all I have to do is refinance the house and then take my parent's off the title, this avoids the 20% down and going through an actual purchase from them. I'll easily qulify, that's not the issue, I was just trying to put a large amount down. But can a refinance actually be done in that way when I was not even on the original mortgage to begin with? They're claiming as long as I'm their child and I've been renting there it can be done by just re-titling and then refinance. We went ahead and have had the house titled in all our names but I want to make sure this is not a shady transaction.

Carylon
No - this is too sketchy. And, any time you are dealing with a big, substantial asset, like a house, you have big estate and income tax issues to deal with.If the house is paid in full (meaning there is no outstanding mortgage) the simpler, legal, way to accomplish this is to have your parents sell you the house via an installment loan. Simply go to www.bankrate.com and figure out what a "fair" mortgage payment would be (you have to figure out the interest rate they will charge you and the length of time you will pay back the loan). Then have an attorney write up a mortgage contract, bill of sale and loan agreement between you and your parents. They "sell" the house to you, quitclaim the deed to you, and then you make payments to them. As long as they record the mortgage lein against the property with your county land records office, you can deduct the mortgage interest from your taxes. It is very easy to do this.If there is currently a mortgage on the house, then ask them to help you with a downpayment, or to pay off the existing mortgage, and add that to the balance of the house.

Glynis
I think you eventually be "caught" when your parents estate comes up for probate (after their death) you can't avoid inheritance taxes (due in almost all States) just by having your name put on the deed. But the only time a 20% down payment would be required would be if you were trying to get a new mortgage. Since you were never part of the original mortgage, YOU cannot arrange for the re-financing; THEY have to do that. But there would have to be a good reason to arrange a re-finance, like to get a lower interest rate or to cash-out, or it wouldn't make sense to pay the fees for the new loan. You can't change true ownership via backdoor practices.

Amiee
You CAN'T change the name on the title without CLEARING the lien form the present mortgage holder. That will not happen until the mortgage is paid. What you are suggesting is NOT a refinance, it is FRAUD.

Carlos
You can do what they call in most states as a contract for deed. No money down is needed, a contract is written stating interest rate and term. Your parents keep the mortgage in their name, but you start paying them for property in agreed monthly payments. For example if your parents owe 15 more years on their mortgage, you write the contract that way. You are responsible for insurance and taxes. You get mortgage interest write off. At the end of period, deed is passed to you. See an attorney.