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I want to partner with my 70-year old mother in law to buy a property. She is going to put $200K down and I am going to get $400K loan (since she won't qualify for loan, and I have a 780 credit score and I can get a good interest rate). She will be living in the house and also will be the person responsible for monthly payments for the mortgage, tax, and insurance.

My question is how much of this property is hers and how much is mine? What's the norm for such a partnership?

  • Do you have the income to justify a 400K loan? Getting such a loan requires more than credit score. – Pete B. May 7 at 14:08
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The percentage of ownership is whatever the partners decide. It is best to define what the initial partnership percentages are at the moment the property is purchased, and how it might change as the years go on.

Your agreement will have to state what happens to the partnership if somebody dies, or if one person has to sell for any reason. Issues such as divorce should be addressed.

Will rent be paid by the person living in the house? You mention mortgage, taxes, and insurance. what happens if the person in the house struggles to make the payment? Who will have to pay for repairs and maintenance will need to be addressed, and how who pays for it may change the percentage of ownership.

All these issues and decisions needed to put in writing, so that years down the road they are less likely to be an issue.

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    If (as is highly likely) the loan is secured against the property, the lender will also have to agree the ownership shares, either explicitly or via a standard clause in the contract. – Mike Scott May 7 at 10:10

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