should I buy a house?

[Ausm]

Make sure you don't get hammered for gift tax!


Sysadmin

 

[rudeguy]

Originally posted by: Sysadmin
Make sure you don't get hammered for gift tax!


Sysadmin

more info please?

 

[DT4K]

If you have problems getting a regular mortgage, check into an FHA loan. They are more flexible about credit. Especially if the last 2 years of your credit report looks better than the previous 5 years.
I got an FHA loan almost 2 years ago for 6.5% with a 574 FICO score.

 

[DT4K]

Originally posted by: GoodDad

Originally posted by: Sysadmin
Make sure you don't get hammered for gift tax!


Sysadmin

more info please?

I'm not an expert, but if it is obvious that 130k is much lower than the actual value of the house, the IRS might consider part of it to be a gift and therefore taxable.

I'm sure the IRS doesn't go around appraising everyone's house and taxing them if they bought it for less than it was worth. But I think the idea was to prevent people from giving selling someone a house for $10 to avoid paying gift taxes. In any case, the seller would be the one who would get taxed, not you.

 

[HardcoreRobot]

Originally posted by: GoodDad
My son's grandpa (my kid's mom's dad) is selling his house.

Would it just have been simpler to say father in law? Anyways, I would definitely say go for it if you can get any sort of reasonable financing!

 

[rudeguy]

Originally posted by: HardcoreRobot

Originally posted by: GoodDad
My son's grandpa (my kid's mom's dad) is selling his house.

Would it just have been simpler to say father in law? Anyways, I would definitely say go for it if you can get any sort of reasonable financing!

he is not, and was never my father in law.

Thanks for all your opinions and support, I will update once I get some (hopefully good) news.

 

[wyvrn]

Originally posted by: Rob9874
Anyone can get a mortgage. Especially only $130K. You can probably get it for no money down, but with a CRAPPY interest rate. Who cares, because you're not going to keep it. Buy it from him at $130K, and sell it right away for $170K. That's called the real estate business. Look at it as your first real estate investment. Use the $40K to clean up your credit, and use the rest as a down payment on another house.

That is the best advice in this thread. :thumbsup:

 

[alkemyst]

Originally posted by: wyvrn

Originally posted by: Rob9874
Anyone can get a mortgage. Especially only $130K. You can probably get it for no money down, but with a CRAPPY interest rate. Who cares, because you're not going to keep it. Buy it from him at $130K, and sell it right away for $170K. That's called the real estate business. Look at it as your first real estate investment. Use the $40K to clean up your credit, and use the rest as a down payment on another house.

That is the best advice in this thread. :thumbsup:

The first part is very untrue though....many cannot get a mortgage.

Interest rate is relative to credit...you can get a 103% loan now at a not so bad rate with excellent credit.

The house may have problems being it's a relative if he's going to flip it....albeit this guy is not directly related, but tax law could state that's enough.

However it the appraisal is accurate to the selling price a bank would feel secure even at a 100% LTV or more. You are talking about a theoretical 25% downpayment.

 

[Epoman]

Originally posted by: GoodDad

Originally posted by: Skoorb
If it's HONESTLY worth $170k (ie. not appraised in the same sense that diamond rings are "appraised", then go for it).

$170 sounds a little low actually. Its not that the house is anything special, its the school district that it is in. The area is sprouting with developments and the price of housing up there is out of control. I checked out the paper today, and similar houses were going for $225k.

Grr....I DONT WANT TO MOW A LAWN!!!!!!!!!

Lazy ass " I DONT WANT TO MOW A LAWN!!!!!!!!, I don't want $40K in free equity" Actually Change lazy ass to DUMB ASS.

I WISH I HAD YOUR PROBLEMS.