LendingTree Quotes Shirlee Gordon on How Parents Can Help Their Children Become Homeowners

Firm News

LendingTree recently quoted Shirlee Gordon on how parents can assist their adult children when buying a home.  The rate of millennial home ownership continues to increase and according to the 2018 National Association of Realtors Home Buyer and Seller Generational Trends Report, they were the top homebuyers in 2017.  Most of these first time home owners are receiving monetary assistance from a family member or friend. One of the ways that a parent can be helpful is by cosigning a loan but it can come with some unforeseen problems. Shirlee explains, “Parents cosigning on a loan can be liable for the loan in the event the child does not make the loan payments.” She also commented on the option of gifting a lump sum, “Most people think they can only give $15,000 a year to each of their children without paying any taxes…However, once an individual gifts more than this amount — which is usually the case when putting a down payment on a home — the parent starts using their gift tax exemptions amounts, which sounds scarier than it is,” she said. “An individual has a [lifetime] gift tax exemption amount of $11,180,000. Married couples can gift double this amount without any tax ramifications.” She also spoke on the pros of gifting a lump sum, “The mortgage interest deduction is capped now at $750,000 for new homes in 2018,” Shirlee said. “The individual who makes the mortgage payments can deduct the mortgage interest on their taxes.”

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