Hi,

My friend needs help buying a house. Unfortunately, his financing won't
be approved for a week or so; the house could be sold by then. I will
NOT co-sign a loan so I am considering buying the house, charge him one
month's rent, then sell the house to him as he would have financing at
this point. What is the downside to doing this besides potentially
being stuck with a house I don't want? If there is any problem or big
costs I will have to pay for to buy and sell this house quickly? Any
advice is appreciated.

TIA,
Dan

Dan wrote:

Hi,

My friend needs help buying a house. Unfortunately, his financing won't
be approved for a week or so; the house could be sold by then. I will
NOT co-sign a loan so I am considering buying the house, charge him one
month's rent, then sell the house to him as he would have financing at
this point. What is the downside to doing this besides potentially
being stuck with a house I don't want? If there is any problem or big
costs I will have to pay for to buy and sell this house quickly? Any
advice is appreciated.

TIA,
Dan

I would say the answer depends on what state and what county;
each may levy transfer fees.
You'll have to have insurance coverage, realty tax proration, etc.
Sounds like gobs and gobs of red tape for no gain...

Jim

I think it took me about a month and a half for my house closing to go
through once I decided to buy it.

It took a week alone for negotiations on purchase price.

I assume you would be paying cash. If you are financing, lenders frequently
require owner occupancy, appraisals, sometimes home inspections. There can
be one little thing wrong with a house and some lenders will not let the
sale go through until it is fixed. They can be a royal pain! For example,
the home I bought had a rose bush growing up against the house. My lender
(FHA) refused to let the sale go through until that rose bush was removed!
(Nothing can be growing up against the house...)

Then there can be thousands of dollars in fees for this, that, and the
other thing. Ask a title company/lawyer about these fees.

You may be required to purchase insurance before purchasing if financing.

If financing and you pay your loan off early, there may be penalties.

Real estate agents get a percentage of the sale from the seller.

So if you have the money, owning an extra house which you could not sell or
rent for a year is no problem (expect your friends financing to not go
through), and this friend is a VERY GOOD friend. Like the equivalent of a
son/daughter or future wife. Then at a minimum, expect a ton of stress
dealing with the legal/financial/sale issues and several thousand dollars
worth of fees which you may be stuck with. (You may not be able to re-sell
the house at a higher price to cover any fees you paid.)

So far as co-signing, Don't! Home loans are for 30 years. Will your friend
still be your friend 30 years from now? If your friend misses payments, it
will wreck YOUR credit...



"Dan" wrote in message
Hi,

My friend needs help buying a house. Unfortunately, his financing won't
be approved for a week or so; the house could be sold by then. I will
NOT co-sign a loan so I am considering buying the house, charge him one
month's rent, then sell the house to him as he would have financing at
this point. What is the downside to doing this besides potentially
being stuck with a house I don't want? If there is any problem or big
costs I will have to pay for to buy and sell this house quickly? Any
advice is appreciated.

TIA,
Dan