Atlanta FHA Kiddie Condo

This is a great program available through FHA that most borrowers are unaware of.  The kiddie condo program is a fantastic way for parents to help their children purchase their first home.  It requires a 3% down payment and uses the credit rating of a “blood relative” (parent, grandparent, sibling, etc) co-borrower to qualify for the loan.  Both the “kiddie” and the relative take title to the home and are on the loan documents.  This means that the loan will appear on the borrowers credit report and help them to establish a strong credit history.

Using the kiddie condo program, the borrower must occupy the property as a primary residence, but extra rooms could be rented out to help offset the cost of the mortgage.    It’s a great way for a college student, recent graduate, or anyone who is unable to qualify for a mortgage on their own credit standing to buy a home, townhome, or condo with the help of a family member.  Yes, that’s right, it doesn’t have to be a condo and it’s not just for kiddies.

The tax benefit for paying the mortgage interest can be divided between the borrowers and co-borrowers depending on how the expenses are paid.

Primary advantages of the program:

• 3% Down-payment required versus a much higher down-payment on an investment property
• Low FHA owner occupied interest rates versus much higher rates on an investment property
• Borrower is able to establish a credit history