This program allows family members to provide long-term care for their aging parents, while at the same time enjoying the benefits of homeownership. The loan comes with several benefits, such as avoiding high down payment costs, minimizing maintenance costs, and not needing to qualify for income or credit score requirements.
Under the Family Opportunity Mortgage, the family member acts as both the borrower and the co-borrower on the loan. As the borrower, they are responsible for making the monthly mortgage payments. The co-borrower is usually the parent, who will receive the home as a primary residence. The loan is secured by the property itself and can be extended up to 30 years.
The primary benefit of the Family Opportunity Mortgage is that it allows family members to purchase a home for an elderly parent without having to worry about qualifying for the loan. The elderly parent does not need to meet any type of credit or income requirements. This means that if they were to apply for a traditional mortgage, they may not be able to qualify, but with the Family Opportunity Mortgage, their age is not a factor.
Another benefit of the Family Opportunity Mortgage is that it allows for lower down payments. Depending on the lender, the minimum down payment is as low as 3%. This means that the family member does not have to use much of their own money to purchase the home. Additionally, there is a cap on the closing costs associated with the loan. These costs are typically 2%-3% of the loan amount, which helps keep the overall cost of the loan down.
Lastly, the Family Opportunity Mortgage makes it easier for family members to maintain the home. When the property is occupied by a family member, they can take advantage of features such as maintenance discounts and tax savings. In addition, the property can be rented out when the family member is not occupying it, allowing them to earn additional income.
Overall, the Family Opportunity Mortgage is an excellent way for families to help their elderly parents achieve the American dream of homeownership. The loan has several benefits, such as avoiding high down payment costs, minimizing maintenance costs, and not needing to qualify for income or credit score requirements. If you are looking for a way to help your elderly parents purchase a home, the Family Opportunity Mortgage is worth considering.
This article was contributed on Nov 28, 2023