Okay, so my parents want to buy a second house, rent it to me, and then help me buy it from them in two years when I’m eligible. So, I have a few questions 1. Can they actually do that? 2. How does that work like, tax wise? 3. Can I get in trouble for that? 4. Can they get in trouble for doing that? I’m also in a bit of a guilt dilemma, I really love and appreciate that they want to help me and make up for the rough young adulthood I’ve had, but I feel wrong for letting someone just do that for me. Thoughts and opinions would be SUPER help. Answers too. hah.

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Posted by Team CentSai (MONEY FORUMS: 9, Answers: 0)
Asked on March 23, 2016 6:49 pm
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Hi Sarah – rent-to-own is a common plan – and children rent homes from their parents on a pretty regular basis. I moved out to Montana within the past year and my parents were thinking of buying a large place out here that I would just rent from them and they would stay in when they visited (I ended up buying, but it was still discussed). My uncle also owns a few houses on the same street and his adult children rent two of them from him.
If it makes sense for both you and your parents financially (and if you’re personally OK with your parents being your landlords) then it’s a great option!

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Posted by Natasha Cornelius (MONEY FORUMS: 0, Answers: 9)
Answered: March 29, 2016 4:39 pm
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Thank you that’s exactly what I needed to know!

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Posted by Sarah (MONEY FORUMS: 0, Answers: 3)
Answered: March 28, 2016 9:24 pm
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I’ve actually suggested my mom does that to help my sister out. My sister would get a better place and rent at a lower cost than market. In your case, your parents could deduct the rent from the house cost and sell it to you under a rent to own agreement. I know parents are allowed to give you money tax free under a certain threshold. In France it is about $40,000 every 5 years. However, they can’t sell to you much under market price, and would have to declare the rent as part of their income so it’s probably better to consider the rent as instalments to the purchase.

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Posted by Pauline Paquin (MONEY FORUMS: 0, Answers: 7)
Answered: March 28, 2016 7:45 pm