My 1st Property - Posted by Tamer Ibrahim

Real Estate Investing Real Estate Financing
#1

Posted by Ed Garcia on November 30, 2000 at 10:16:27:

Tamer,

You say that your parents are willing to sell you the condo at a discount and allow you to take over the payment on the existing first mortgage. Tamer, you don’t tell us the interest rate of the existing first for me to advise you if it would be more beneficial for you to refi the first, or acquire second mortgage.

Tamer, if this were my deal, I think I would ask my parents to borrower on the condo for me and then take over the payments on the second as well as the first. Since your parents trusted you enough to allow you to assume their first to begin with, I’m sure they wouldn’t mind. This would be faster and cleaner way, from the standpoint of qualifying and down payment. You could have your parents quitclaim the property over to you after the refi and then document your payments so that you can have credit for making the payments, and in year or two when you do a new refi in your name, you would have proof of payment history.

Ed Garcia

#2

My 1st Property - Posted by Tamer Ibrahim

Posted by Tamer Ibrahim on November 29, 2000 at 16:35:26:

Hello,

I am new to the field of real estate investing and have been visiting this site frequently to get ramped up for the past couple of months (great info by the way - thanks a lot).

I am currently trying to structure a deal to purchase the condo I am currently living in. I am renting it from my parents who are willing to sell it to me at discount. There is about $90k left on the mortgage and the fair market value is about $150k. They just want me to take over the existing mortgage. I want to use the remaining equity to pay off my car, school, and credit card loans to take advantage of tax deductions and use some of the left over cash to get started with my first real estate deals and take some of these seminars being offered to help me do so.

I’m not sure the best way to do this. Ideas I have considered include applying for a 80-20 LTV ($120k) using $90k to pay off the existing mortgage and the other $30k to do the above mentioned but then I would have to pay the capital gains tax on my parents behalf.

Alternatively I might be able to do a transfer of title (not sure how this is done) to assume the existing mortgage and later take a home equity loan to help me get started. I have also heard briefly of a bargain sale or selling blow fair market value which would result in part gift part sale but I’m not sure about the tax implications of these methods.

Does anyone have any ideas on the best way for me to procede. Thanks in advance - hopefully this will allow me to become more involved with you experts in the near future.