An Identity-of-Interest transaction is where a sales transaction is made between parties with family/business relationships.
To break it down very simply, and this is USUALLY always the case, when a family member sells to ANOTHER family member, FHA looks at that as an Identity-of-Interest Transaction.
I get at least 1-2 calls per month with this scenario, and want to post it on my mortgage blog to educate YOU, the consumer.
So even though FHA has a minimum down payment requirement of 3.5%, in THIS case, you would have to put down 15% percent.
Here is ONE of the exceptions to this rule:
1. The family member has rented the property for at least 6 months predating the contract, in which case a rental agreement will be needed.
If you are in this type of situation and do not have the 15% to put down, feel free to contact me for more info and some other tips that may help you out!
Tags: fha, fha loan, Houston, houston fha, HUD, san antonio
