Getting a loan from my parents to buy a $450,000 house. $90k sounds like because I can keep cash on hand. Here’s my $499k net worth broken down. Vanguard Roth IRA $43,765.42 Vanguard Brokerage $261,212.62 (all in a settlement fund now, sold all my stock to buy the house + furniture + peace of mind) HealthEquity HSA $13,638.86 Principal 401k $105,142.29 Robinhood $18,515.12 Amex Savings Account $32,127.60 Chase Bank $24,730.04 Last thread on this I swear.
Tech Industry
Yesterday
1104
How common is it actually to earn more than 300K TC?
Tech Industry
Yesterday
2956
Quitting this Slave life
Working Parents
15h
1163
Closed now - thank you all
India
Yesterday
1076
Modi is a legend, will be remembered for centuries to come
Tech Industry
Yesterday
2375
The end of Backdoor Roth?!
Important distinction - if interest rates drop, will your parents renegotiate the rate with you (refinance)?
No but i can go to a bank
They absolutely should. And looks like they are offering very good deal.
I thought it was crazy too, but I did read this is an easy way to avoid gifting / tax laws
The difference in the rate is 2%. You can take the down payment difference ($110k in this case) and simply throw it into an HYSA and it'll make double that rate already.
The 2% interest difference applies to the loan amount, not the down payment. So the gain will be bigger. It can be worth doing e.g. 25% instead of 20% down payment even for just 0.2% drop in mortgage interest. In OP's case, the $200k down/2.99% interest is almost certainly better financially. Only downside is less liquidity, but if that's acceptable I'd go for it.
You are right. My math was wrong.
What kind of house are you getting for $450K if you're in US. I can't even get a 1b1b for $800K in my location
Move to Phoenix
Are you asking about house type when he says 2.99 interest on the post?