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Does anyone know if this scheme would work? Its a little crazy...

So, my DH and I are working on buying our first home. My brother plans on renting a room from us when we buy it, to help us cover the little bit of the mortgage that we would need help with. But since we can't qualify for the loan without that extra income, my parents are willing to put the mortgage under their names, as well, so between their income and ours, we'd qualify for the house, even though my parents already own a home and wouldn't be living in it. And if they were on the mortgage, since my dad is a veteran, we might even qualify for no downpayment. BUT, we don't know if that is even legal. Does anyone know?

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Anonymous

Asked by Anonymous at 4:04 PM on Jan. 21, 2010 in Just for Fun

Answers (34)
  • BAD, BAD idea... what happens if you for some reason can't pay the mortgage... you will screw your parents credit. If you can't afford to buy the house in your name then you shouldn't buy it, it means it is more house than you can afford.
    peanutsmommy1

    Answer by peanutsmommy1 at 4:06 PM on Jan. 21, 2010

  • BAAAAAAAAAAAAAAAAAAAAAAAAAD IDEA!!! dont do it
    Anonymous

    Answer by Anonymous at 4:07 PM on Jan. 21, 2010

  • Don't do it. Get a house you can afford!
    nichole0509

    Answer by nichole0509 at 4:09 PM on Jan. 21, 2010

  • OP - it isn't more house than we can afford. Its a very, very cheap house ($85,000)We are living w/ my parents now b/c we can't afford to pay rent, and this house is such a good deal that the mortgage is literally half what we'd be paying in rent. And like I said, my brother will be living with us to help us pay it, we just can't claim that as income until we actually buy the house. Its complicated, but we'd definitely be able to pay the mortgage, my brother will only need to give us 200/mo for us to afford the house easily.
    Anonymous

    Answer by Anonymous at 4:09 PM on Jan. 21, 2010

  • if you can not afford the mortage ON YOUR OWN, then you can not afford it
    peanutsmommy1

    Answer by peanutsmommy1 at 4:10 PM on Jan. 21, 2010

  • OP - I should add, tha the reason we cannot afford the mortgage on our own yet is because when we move, we will be relocating to a different state, and I will not have a job until we actually have a place to live. My DH has a job lined up, we just need that time to allow me to find a p/t job that gives us that extra income.
    Anonymous

    Answer by Anonymous at 4:12 PM on Jan. 21, 2010

  • There are lots of things that could go wrong in this scenario. 1. Your brother could decide to move out (you really can't expect him to live with you forever). 2. You should NEVER try to buy a house that is beyond what you can reasonably afford. 3. You should qualify for a mortgage that is considerably more than what you should spend (My husband and I qualify for about $300K, but the house we are buying is $127K). 4. You should NEVER ask your parents to put a mrtgage in their name for you (if you or your husband lose a job and can't make payments your parents are stuck making them or letting their own credit rating go down the drain. 5. There is a possibility that your dad using a VA loan to buy a house for you is illegal, but even if it's not it is not completely ethical. 6. No down payment is a very bad idea.

    My advice - save up for a down payment and get financing on your own for a house you can afford.
    Anonymous

    Answer by Anonymous at 4:15 PM on Jan. 21, 2010

  • This is incredibly financially stupid and irresponsible. I can't believe you're considering it. What happened to BUYING SOMETHING YOU CAN AFFORD!?
    elleinad

    Answer by elleinad at 4:17 PM on Jan. 21, 2010

  • OP - I'll also add, since everyone seems so concerned about it, that we WOULD be able to pay the mortgage, even with no help from my brother. We just don't want to be "house poor". I've crunched the numbers a thousand times and we'd be "okay" with paying it, the money from my bro just helps us make sure that if we have an emergency, the money is there to use. We just don't qualify for the actual LOAN without extra income, because we have some loans out already that we plan on paying off very soon (tax returns), we just can't actually claim that and have them just believe us - we need to prove that the money is there NOW. So stop saying that we shouldn't be buying more house than we can afford - we aren't. We are just trying to get around the stupid red tape.
    Anonymous

    Answer by Anonymous at 4:19 PM on Jan. 21, 2010

  • If $200 a month is going to make that much difference it is more than you can afford.

    Your parents could buy a house and rent it to you with a plan for you to buy it from them later. That might not be a terrible idea if they were willing to do that.
    Anonymous

    Answer by Anonymous at 4:20 PM on Jan. 21, 2010

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