Here’s how you can purchase a primary residence for your parents. In most cases, if you’re purchasing a house and you are not living in the property and somebody else will be living in it, it’s typically considered an investment property. Even if you’re purchasing it for a family member who will not be paying rent, it is still considered an investment property.
How a Conventional Loan Makes This Possible
But conventional loans have an exception to this. When it comes to a child purchasing a home for their parent. If the parent is unable to work or can’t qualify based on their income, the child is allowed to apply for the loan as a primary residence, meaning you can put the minimal down payment.
As long as the parent will be living in the property as their primary residence and you can document that they can’t qualify on their own, the child can then apply for the loan as a primary residence and purchase it as a primary residence.
Why This Is Better Than an Investment Property Loan
The benefit of this, as opposed to an investment property, is that investment properties typically have higher down payments and higher interest rates than a conventional primary loan. So by doing this, it will give a better interest rate, require minimal down payment, and help get the parent into a home.
If you have any questions on how this program works, feel free to reach out.
