Q: Can a contract be drawn up requiring me and my partner to return the gifted deposit, if the house is sold or foreclosed?
My family are giving 60k to my partner for a house deposit. However, as first time buyers I cant go on the mortgage due to being a student. In the contracts it states it is a gift. However, we were wondering if it would be possible to have a contracted drafted stating if we become in financial difficulties with the house my parents will help with funding but in return if the house is sold, we must return the 60k from the selling of the house?
My Parents, Partner and Myself all agreed to this we just need to know if this will be possible from a legal point of view.
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A: Your Parents will want a Deed of Trust securing their loan by Note signed by the borrowers. However it may have to be a second priority mortgage which include a default provision for non payment of the first priority Deed of Trust. Hire a competent attorney, not a title co., to draft these instruments. Do not close on home without Parents being protected. If partner will not sign both Notes, then do not buy that property.
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