Avoid FHA financing restriction on intrafamily purchase

Future-Proof: Navigate Threats, Seize Opportunities at ICNY 2018 | Jan 22-26 at the Marriott Marquis, Times Square, New York

DEAR BENNY: I am currently trying to purchase a home from my daughter. The loan was approved, but the lender told me there is a law that if you purchase a home from a family member, they can finance only 85 percent of the sales price. Is this true? --Roger DEAR ROGER: I was not aware of this so I contacted Craig Strent, from Apex Mortgage in the Washington, D.C., metropolitan area. He confirmed that FHA has such a guideline. The only exception is if you have been a tenant in the property and have been so for at least the previous six months. Why not move in and rent the house from your daughter for six months? Interest rates are currently very low. While I doubt rates will go up soon, no one can predict where rates will be in six months. You have to make a business judgment whether you will be better off just taking the 85 percent loan (if you can come up with the difference) instead of waiting the six months. DEAR BENNY: I put my estate in a trust. I would like to make s...