Is Buying A House From My Parents A Good Idea?

Is Buying A House From My Parents A Good Idea?

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[nathangolding]

Some of the best money I ever spent was 2k in loan fees at a credit union to pay off my parents. Makes the relationship weird owing family money. Plus they judge every time you mention you go on vacation or buy something half way nice. Even if you are making double to triple the monthly payments.

[GenExDividendInvestor]

Side note -- If you do decide to do any sort of business with friends/relatives, make sure to sign contracts/etc (don't just assume the friendship or relatives will resolve any issues). I made the mistake of doing a real estate deal with a relative and didn't sign on a dotted line, and then lost all my investment because their recollection of the deal was different than mine. Harsh lesson to learn.

[jaysmith]

I was lucky enough to get this same deal from my very generous parents. My parents purchased a house in cash where my wife and I live. We paid them them interest free, $3000 a month for 5 years and now we are homeowners. My parents are amazing, never once was money mentioned. My parents actually forgave the debt 1 year into the process and said they wanted us be happy and debt free. We felt we wanted to pay it off so we did. Never once felt wrong, weird, less, disrespected.

Situation completely depends on the people. But I will agree that this probably isn’t a good idea for most people

[DanielIles]

Having things in writing always make it safer no matter how safe you think it may be!

[graceelizabeth]

If you have a contract I don't see any issue. You pay them back every month for the amount agreed.

[katrinaumana]

This guy is a rockstar 🎆. A business degree & no debt. About to buy a 🏡

[georgiannmaloney]

Don't do it. Hubby and I did it and not a good thing. No get a loan from the bank. Get a home not in the family. Not worth it.

[katywillett]

He doesn't mention if he has siblings. If you borrow money from parents, even if you pay them on time, if a parent passes, there will be confusion and hard feelings. If you cannot pay cash - go to the bank!

[billyrayband]

No real issue with doing a land contract with parents in this case (but in writing!!) and its a good income source for them. I trust them more than a freakin bank. You also avoid a lot of closing costs, realtor fees, etc.

[patty]

Dave’s advice on this call was some of his best ever. I hope the caller takes it to heart.

[nathanmendez]

This is close to the same that is happening to me. i am renting from my parents however they have stated that they will give the house we are renting to us eventually. Since nothing is in writing i just seeing it as renting from any other landlord until we are actually given the home.

[theGrayArea]

This is the way I see it...if his parents are willing to let him pay off this loan pretty much interest fee, they’ve done a good job with raising him in the sense that they trust him enough and don’t feel the need to make any extra money off of him or make a huge deal about anything. I’d assume if one day the Son wasn’t able to pay it back they’d work something out, because they seem to have a great relationship, money may have changed scenarios for Dave in his life and for others also but it doesn’t mean it’s the case for everyone

[NickPeitsch]

Congrats on the success man!


You're well on your way to financial freedom!

[sniperammow]

100% doing that, getting my md and will support the people who supported me.

Parent circumstance could change during 6+ years, what if they use the house as loan collateral and ends up with a lien or soomething?

[amandaowens]

Good point, that the loan from parents would strain relationship between new wife and mother-in-law.

[cathyrowe]

Why not buy the house outright with the cash & do the repairs pay-as-you-go? No loan at all this way.

[gkr]

Not don’t borrow from relatives, borrow from the bank. They can gift you if they wish. Like Dave said, you’re just looking at the deal and how you profit from it.

[gigibarrett]

Can anybody PLEASE give me advice because my dad is getting to the point of needing help to care for him.. long story short he lost the land My grampa Left him due to fraud! I’ve accepted there’s nothing we can do about it so now I’m trying to figure out if it’s possible for me and my father to combine our ssi disability to buy a home so I have some where to take care of him because he took care of my grandparents keeping the promise to never put them in a nursing home so I feel my dad deserves the same! I have no idea what to do as my siblings are not helping me and without anything saved and losing everything I just don’t know to save my dad from putting him in nursing home. He begs me to promise him I won’t so with all this it would break myheart to have to leave him in one! IS there any way to buy a house with low income ?? So I can not send him to a nursing home? I’m really not sure how to do any of this honestly! Any advice please??? 🙏

[artistman]

If the house is a good deal and he could have it paid off in 6 years @ 0% vs 15-30 yrs @ 4.5%. Sorry, I don't agree with Dave. As long as they transfer ownership the same way and he can come out ahead I would save the money.