Private Mortgage Financing Questions

by Peter
(Washington DC)

Private mortgage financing questions: Dear Kate, My partner and I are looking into purchasing a home in nearby Maryland, with private financing from her brother who is offering to lend us the money for the house at a rate of only 3% interest for a 15 year mortgage. We will pay 20% downpayment and closing costs.

What should we be aware of as we draw up a contract with our title agent? Will a title agent and our real estate agent be the only professionals we will need in this transaction? We want to make sure that we are able to deduct the mortgage interest and property taxes that we will be paying from our income taxes. And that we can claim a first time home buyer credit as well. Do you have any advice?

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Dear Peter,

Wow! What an opportunity for buying a house! You are going to love my answers to your private mortgage financing questions.

First of all, grab some tips at Private Mortgage Financing to answer your questions about property tax and mortgage interest deductions as they relate to financing between family members.

Go here to see if you might be eligible for the First Time Home Buyer Credit.

Next let's look at roles of key players for home buyers. Have you ever heard of a dream team for buying a house? Let me introduce you. You have already mentioned a real estate agent. In some states, to close a transaction, home buyers and sellers use escrow or attorney services.

Even though with private financing it is not required, I'm sure you'll want to investigate title insurance and homeowners fire insurance policy.

What about a home inspection and the property appraisal?

Peter, are you contemplating fixer upper houses? How about buying a foreclosed home? Either way make an easy job of it by using my free Home Buying Scorecard.

Take a moment to bookmark Private Mortgage Financing Questions to your favorites so you can easily return to this page. Visit often for more tips on buying a house. You can also invite friends to comment on this page or ask another question of their own like you did.

Check out more tips for buying a house and comparing mortgage interest rates at the bottom of the page too!

Best Wishes,

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