Legal Question in Real Estate Law in Massachusetts

Re: Purchasing Home from Parents

More detailed information is required to give you a full explanation. However, your parents can escape any Federal Capital Gains tax on their home for up to $500,000 assuming the have used the home as their primary residence for 2 of the last 5 years.

Unless they have more than a $500,000 gain on the home, there is little tax at issue.

Assuming they own their home free and clear (no mortgage) then you can purchase the home with as small a down payment as they want and take a mortgage on the home with monthly payments from you, provided that the interest rate is one within the federal guidelines for arms length transactions.

However, if there is an existing mortgage things become more problematic unless it is assumable, which most mortgages today are not. Without more facts it is difficult to give you any more guidance. I would suggest you contact an attorney to set-up the transaction.

There are also some other alternatives to buying the home, that could work as well depending what the purpose and goal is here.

I hope this has been helpful. Please feel free to contact me if you have more questions.