A great way to get started buying a condominium is by using the FHA Kiddie Condo Loan Program. This type of mortgage allows a person to co-borrow with a blood relative (eg. parent, grandparent, sibling, etc.) who helps qualify for the loan using their income or assets. Both borrowers take title to the property and sign for the loan. There are three big advantages to using this type of loan.

1. A low down payment (as little as 3 ½% of the purchase price).
2. A lower, owner-occupied interest rate on the mortgage versus the higher investment property interest rate.
3. Helps the new borrower establish a solid credit rating.

At least one borrower must occupy the property as his/her primary residence, but extra bedrooms could be rented out to help cover the cost of the mortgage payments. This is a perfect way for a college student, recent graduate, or anyone unable to obtain a loan on his/her own to buy a condo or townhome with the help of a family member.

The tax benefits, such as deducting mortgage interest and real estate taxes on a Federal Income Tax return, can be divided among the owners, according to who pays the expense. See your tax advisor for details.