QUESTION: My wife and i are considering buying our first home. The mortgage
that we were pre-approved for was lesss than what would be necessary to buy
in the neighbourhood we want to live. So, we are exploring buying with my
parents. The arrangement we are thinking of is where my wife and i own
two-thirds of the apartment and live in it, while my parents own 1/3 and
continue to live in their current residence. I would appreciate your advise
with respect to the legal, tax, resale, implications of this kind of
arrangement. Also, if you could refer me toa resource that might provide a
smaple contract for this type of arrangemnt, that too would be most
appreciated.
Thanks,
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david ingram replies:
If your parents are going to be making some of the payments, what you
proposes may make sense and they would have an investment which would be
subject to capital gains tax upon sale.
However, if you are going to make the payments and just do not qualify for
the mortgage you want, have your parents co-sign a loan for you or put a
small mortgage on their own home to make up the difference.
That way, you would get a lower interest rate as well and both houses would
be tax free principal residences. with you and your spouse making the
payments on both mortgages.
Otherwise, I do not know of any pre-written agreement and suggest that you
contact a local real estate lawyer to assist you.
If you are in the Vancouver area, David Stoller at (604) 922-4702, Bill
Spohn at (5604) 926-8681 or Tom Woolley at (604) are three possibilities I
would recommend.
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