Lucie
Recycles dryer sheets
- Joined
- Aug 25, 2018
- Messages
- 154
My daughter and son-in-law are purchasing a house from his mother. She is gifting them some of the equity. The sale price will be $80,000. With $22,000 down, they will need about $64,000 with closing costs. We plan to gift them $30,000 and are willing to hold the mortgage of the remaining $32,000 to save them bank mortgage fees, etc.
The seller’s attorney states: "there will be a $300-$400 for the lender attorney fee, which is always paid by the Buyer (even though the “lender” is her parents as opposed to a bank, they still need to be represented).”
My question is: Is there another way around this? Can we just draft up a private notarized mortgage agreement and put the money in their account for closing? Or can we provide a personal loan for $32,000 with a legal promissory note? We plan to do everything above board, including charging interest as required by the IRS. We don’t want to raise any questions with the IRS.
My daughter is very financially responsible. I have no concerns about their ability or willingness to pay the loan. As one of our 3 heirs, she would have a lot more to lose than $32K. So that is not a concern. My parents provided the same opportunity when I purchased my first house and we’d like to do the same.
The seller’s attorney states: "there will be a $300-$400 for the lender attorney fee, which is always paid by the Buyer (even though the “lender” is her parents as opposed to a bank, they still need to be represented).”
My question is: Is there another way around this? Can we just draft up a private notarized mortgage agreement and put the money in their account for closing? Or can we provide a personal loan for $32,000 with a legal promissory note? We plan to do everything above board, including charging interest as required by the IRS. We don’t want to raise any questions with the IRS.
My daughter is very financially responsible. I have no concerns about their ability or willingness to pay the loan. As one of our 3 heirs, she would have a lot more to lose than $32K. So that is not a concern. My parents provided the same opportunity when I purchased my first house and we’d like to do the same.