Does any have any thoughts on creative financing options in my situation?

Here's the background:

I have poor credit and want to buy a house of approx. 400k. I am also self-employed. I have no deposit, not least I do not plan to sell my existing property.
So far, so bad.
However, my father has a property worth approx. 1million with no mortgage, and probably at least 100k or so in savings. I am his sole heir, and while I know he would not feel comfortable buying a house for me (fair enough), I believe he would be interested in trying to mitigate the future inheritance tax bill.

So here's my thinking - would it be possible for him and I to buy the house together, with the mortgage in his name - I'm thinking an interest-only mortgage initially - with a view to me taking the mortgage over in the longer term?

Also, would it be possible for him to use an offset mortgage for this purpose, so that as little as possible of his money is actually tied up in the property? And does an offset mortgage mean that you don't need a deposit if the savings for the offset are substantial (e.g. 25% of the purchase price or more).

Or would it be possible for him to mortgage his property and use that money to buy the house, with me paying him back? Could that also help with the inheritance tax situation, potentially?

Or does anyone have any other thoughts or ideas as to what kind of proposal I could put to him to be able to buy the house (and ideally reduce the inheritance tax liability)?

Many thanks in advance!

Firstly, there is no way to buy yourself a second home (which I think is what you are hoping to do???) without a deposit, whether it comes from you or your father. And an offset mortgage won't allow you to do things this way either.

It may be possible for you both to buy one together, but it will depend on both your incomes and debts. If the mortgage is solely in his name, then the _title_ deed will have to be solely in his name, ie he will own the property.

It would be possible for him to remortgage his main home to give you the deposit,which could potentially assist with inheritance tax(IHT), and then you could get a mortgage for the rest of the property, depending on your income and debts. Being self employed won't neccessarilly cause you too many problems.

He could buy it himself and gift you the property, which could assist in reducing his IHT liability, but you need expert advice here which I can't give, although my colleagues can. But if there is a potentially large IHT issue, you need expert advice or you will potentially lose a lot of money to the tax man unneccesarily.

You haven't mentioned your fathers age, but this won't necessarily cause a problem, although it may well reduce the pool of lenders you have to choose from.

But overall, I can't really offer you detailed advice without a lot more information.

You can contact me for a free chat on 01208 816667 if you like. The company I work for is Worldwide FInancial Planning and my colleagues will be able to offer advice on the inheritance tax issues as well.

Your father can at least cosign for you. He can also pull out his equity in the form of a line of credit or something and let you use it as a down payment. In most places, 25% down or more and you can get a loan, regardless of how bad your credit actually is. You'll just want to make sure he's willing and able.

Frankie
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I totally agree with your answer as there will not be possible that you can buy another home on the basis of the mortgaged home. For this you have to pay all the money to get it like a arms' length transaction.

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Creative financing is used for purchase, or finance a property.
creative financing has many kinds
1. hard money loan
2.Simultaneous Closings
3.short sale