Susan's Blog

Wednesday, August 27, 2014

New Development for Disabled Housing Mortgages!

Valuable home-purchasing information for anyone in the country with a developmental disability looking for a possible low percentage down mortgage. I received this information from Austin Texas Real Estate Agency. It may now be possible for parents to buy with very little down through Fannie Mae if the property is for a son or daughter with a developmental disability!

How to get a 5% down mortgage from Fannie Mae if you are buying a property for a son or daughter with a developmental or physical disability:

  • A parent (or parents) who is a natural person (i.e., not an LLC, or a co-op) can get a Fannie Mae loan for 5% down, and there is no cap on the parent’s income. Second mortgage is also possible but with a higher monthly payment.
  • Fannie Mae considers it to be owner-occupied by the parent who does not live there, if the child is unable to work or doesn’t have enough income.
  • The parent is still allowed to have their own primary residence.
  • You may collect income from residents, but this income cannot be used for the mortgage qualification.
  • You will need to check with an accountant to determine whether the mortgage interest is tax deductible. It is quite possible that the IRS will consider it an investment property (i.e., the mortgage interest wouldn’t be deductible).

The key language is in the Fannie Mae selling guide.

In research they conducted, it is noted that if a property is used as a group home, and a natural-person individual occupies the property as a principal residence or as a second home, Fannie Mae’s terms and conditions for such occupancy status as provided will be applicable.
Also please note, this is different from the Fannie Mae HomeChoice program, in which the individual with a disability is the owner of the property, and the family member is a non-occupying co-borrower. In this case, the family owns the house. This *should* allow the person with a disability to use a Sec. 8 voucher, provided the local housing authority permits the family to be the landlord as a reasonable accommodation. This is not true of HomeChoice, which doesn’t permit the use of a Sec. 8 rental voucher.

This is a very exciting discovery.
Also we advise you to start use Imbrex for more fair data about real estate market.

As always, neither I, nor Cathy Boyle, nor Autism Housing Pathways, is engaged in providing financial or legal advice. Always double check everything with your own financial and legal advisers. A full legal disclaimer is available at the Autism Housing Pathways website.


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