Legal Question in Real Estate Law in Massachusetts
Gift of equity. Repaying a portion to the family
My wife and i have a deal in place to buy a house appraised at $485 for $400 from her uncle. The plan was to pay him back another 50k over 5 years. Is this legal. He will be paying taxes on the $485 so does the gift of equity say no side deals?
1 Answer from Attorneys
Re: Gift of equity. Repaying a portion to the family
It strikes me that you are trying to buy a home based on a value of $485 using the gift of equity as your equity for purposes of obtaining financing. Depending upon the terms of your loan application, this may be a problem wirh respect to the lender's underwritng requirements.
As long as you are not misrepresenting facts on your loan application, what you give to your uncle and what you don't is between the two of you. However, the whole transaction may violate the underwriting rules of the bank or lender.
Without more information about what you are doing it is impossible to properly answer your question.
Related Questions & Answers
Looking for something else?
10,200 active attorneys ready to answer your legal questions today.
Featured Attorneys
Earn additional revenue and grow your business.
