: You get the same favorable interest rates and low down payment requirements (as low as 5%) as a primary residence, even though you won’t live there.
: Typically requires the home to be a certain distance from your primary residence (often 50+ miles) and may have higher rates than a primary mortgage.
: You act as the bank, lending the money directly to your relative at a minimum interest rate set by the IRS, known as the Applicable Federal Rate (AFR). 2. Understand Ownership and Legal Structures
: If the relative doesn't meet the "disabled child" or "elderly parent" criteria, you can buy the home as a second residence or investment property.
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