There are about 10,000 people that turn 65 every day. That means that more people retire, and might need additional care as they get older.
For you and your parents, you might be looking at your options to make sure they have a high quality of life and independence. You can look at assisted living facilities or buy a home in a retirement community for them.
If you’re interested in buying a house for parents to live in, there are ways to do it that are more affordable than you think. Keep reading to learn more about programs available to make homeownership a possibility for your parents.
1. Buy a Second Home
The most obvious choice to buy a home for parents to live in is to just buy a second home. You’d treat it like any other second home, but your parents live in the home.
You could always rent a property, but owning a property has its benefits and gives you and your parents an extra sense of security. You can’t control if the landlord will sell the property, forcing your parents to find another home.
A second home is often difficult to obtain because you have to pay a down payment of 10% – 20%. That is a big obstacle for many families.
2. The Family Opportunity Mortgage
The Fannie Mae Opportunity Mortgage is a loan program that essentially removes the high down payment obstacle. You can buy a home for your parents, and be treated as if the home is owner-occupied.
An owner-occupied home gives you a chance to qualify for a lower down payment and sometimes better loan terms.
The key for you is to find a lender who offers Family Opportunity Mortgage and can guide you through the qualifications.
3. Purchase an Investment Property
Purchasing an investment property may seem like a good option in the long-term. You can use the property for your parents, and then hang on to the property for rental income.
Another option is to sell the property, but you’d have to pay capital gains taxes on the profits of the home.
Like buying a second home, buying an investment property does require a heft down payment. For most investment properties, you’d have to pay 20% – 30% down. Unless you knew that you could profit from the property, it may not be the wisest decision.
Buying a House for Parents to Live In
As your parents age, you want to make sure that they’re able to live in a nice home without worrying about finances. Buying a house for parents to live in becomes a priority.
The biggest opportunity is the Family Opportunity Mortgage. This is a program that allows you to buy a home for parents to live in without paying a high down payment. This proves to be a better option when compared to buying an investment property or a second home.
Once you buy your parents a home, you’ll need tips to move them. Check out the Moving section of this site for helpful tips.
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