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JoeSpareBedroom

h wrote in message ...

"PaPaPeng" wrote in message
...
On Wed, 5 Mar 2008 20:35:07 -0800 (PST), "hr(bob) "
wrote:

This is a little OT, but I am going to take over the mortgage on my
son-in-law and daughters house as I can get more interest from them
than on a cd and they will get a lower rate from me than they can get
at a bank. (5%). What is a good, cheap way to get the mortgage forms,
and what are the different pieces of paper called. It has been a long
time since my wife and I had a mortgage and I am rusty on all the
various names.

TIA

Bob Hofmann

I don't think you can issue a private mortgage to another private
party. Only licensed mortgage companies can do so. This is how I
would consider the problem. Make a private loan to your son to pay
off his bank mortgage. Your son will pledge the title to his property
as security. That security pledge will be a lawyer vetted document
transferring the property to you but remains undated, to be effective
any time the date is inserted. You should register this document with
some government authority. On a separate contract spell out this fact
together with the terms of repayment, etc. Don't do this on a
handshake. A house is a big ticket item. If there is trouble you not
only lose the money you also lose your son and his family. You can
always forgive the loan. But never put him in a situation where he
can delay a problem by stalling. That delay wreaks even the closest
relationships. Don't forget you have to declare the 5% as income for
tax purposes.

Plus, the son cannot take any mortgage tax deductions, since it won't be a
mortgage, just a loan.

I'm not so sure about that. What makes a loan a mortgage? What it's used
for, or who you get the loan from? Sounds like a question for the IRS or a
tax attorney. I'm not about to go poking around in Turbotax at the moment,
but clues might be there, too.