Mortgage loans between family members can be a win-win deal.

Proper documentation prevents tax problems and protects relationships.

How it Works

Real estate loans and financial gifts with relatives can be a win-win for both sides, but should be documented properly. National Family Mortgage ® helps minimize the legal and federal tax consequences that can occur when family real estate loans and financial gifts are documented improperly – or not documented at all.

You can use a National Family Mortgage ® in many of the same situations you might use a traditional bank mortgage, including:

  • To help a family member purchase a home
  • To sell a home to a family member
  • A family funded Reverse Mortgage: Our Caregiver Mortgage ® is a secured line of credit, funded by the relatives, of a retired loved one. When the Borrower’s home is sold one day, or upon the settlement of their estate, the credit line is repaid.

We help Lenders make loans they feel good about, that prevent tax problems, transfer wealth, and protect family relationships. We help Borrowers fund their dreams and stay on track with payments. Our goal is to make family mortgage lending and borrowing safe, easy, secure, and successful.

We facilitate Home Purchase / Seller Finance loans in all 50 states*.

* If the Borrower’s subject property is located in Cook County IL, Kane County IL, Peoria County IL, or Will County IL, unfortunately, we cannot facilitate the loan transaction.

National Family Mortgage ® is happy to work with you and your clients in whatever way makes you look great. Some financial advisors will guide their clients through our Family Mortgage process from A to Z. Other advisors may initiate a family conference call with one of our Family Mortgage specialists. Most advisors simply refer their clients to our website for help.

Please be sure to review our company Standards found on Page 5 of each Family Mortgage Guide for complete restrictions and limitations.

Structure the Loan

How much money will be loaned? How much interest will be charged? How much can the Borrower afford to pay each month? Our collection of free Family Mortgage Guides include lots of tips and advice on how to work with the Lender and Borrowers to structure their loan to be a complete success. We also have some great calculators on the Products / Pricing pages to help them get started.

Document the Loan

All National Family Mortgages ® have two crucial components:

Promissory Note: The Promissory Note establishes the legal debt between the parties and records how the debt is going to be repaid.

Mortgage / Deed of Trust / Security Deed: This is the legal security instrument through which the Borrower offers their property as collateral to the Lender in exchange for the loan. Attached to the Mortgage / Deed of Trust / Security Deed is a legal description of the property that we will obtain from the County authority where the subject property is located.

Within one business day of receiving an online Application, a Family Mortgage Advisor will call the client and/or financial advisor to confirm the details of the loan. Within seven business days of receiving the online Application, we will email the family customized, state specific mortgage documents for review and approval. We will also include setup forms for our optional Family Mortgage loan servicing program.

Register the Loan

For purchase transactions, National Family Mortgage ® will coordinate the government registration of the loan with the Borrower’s closing attorney, title company, or escrow company. For other transactions, the family should return their original, notarized documents to National Family Mortgage ® for legal public recording at the appropriate government authority. If the loan is a purchase money mortgage, or a refinance of acquisition debt, this will allow the Borrower to legally deduct their mortgage interest payments from their federal tax return — just like with a bank mortgage.

Manage the Loan

With our optional Family Mortgage loan servicing program powered by FCI Lender Services, Inc., expectations are clear, relationships are protected, and year-end tax reporting is simple.

  • Monthly payment reminders and statement
  • Electronic payment processing and online account access
  • IRS 1098 and INT-1099 tax reporting
  • Toll-free customer support