Question: Can anyone brief me on the basics of LLC’s or where to find more info?
Would such a corporation be appropriate for me to enter into with my son for purchasing jointly owned out of town (for me) real estate for investment purposes? Is an LLC essentially a S-corp for partners???
Are there better partnership arrangements?
Thanks,
Answer: I want to buy a house with two other persons. One of the buyers will not be a resident in the new home. Because of this, we have problems qualifying for a 30 year fixed mortgage with a 10% downpayment. Our mortgage broker says that most lenders will not take the loan because they will not be able to resell to Fannie Mae or Freddie Mae. In addition, PMI mortgage insurance does not allow non- resident buyers. Our broker suggest that we go with a 5/1 with 7.5% fixed rate. Is this the best solution or are there other alternatives? I don’t know real estate law in CA, and I’m not a Fannie Mae underwriter, but I was in banking for ten years and now own a real estate investment company. I have never heard of your problem before. Your third party is a co-borrower, but you – the primary borrower – will occupy the property. This loan will be an owner-occupied loan. The broker may be right, but I would call around if I were you. Good Luck!
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