A win-win: intrafamily loans encouraged

Purchase-assist financing for a Generation Y (Gen Y) family member by their parents or relative is an especially compelling opportunity in the current real estate market. Intrafamily loans benefit both the parent, as lender, and their offspring, as borrower. It also gets the child out of the house.

Though mortgage rates are at record nominal lows of around 4% fixed for 30 years, the return by lenders to mortgage origination fundamentals is not permissive enough to allow many first-time homebuyers below the age of 30 to obtain a mortgage from an institutional lender. Lack of savings and sufficient income for down payments and monthly payments is the barrier.

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