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Andrea, Esq.
Andrea, Esq., Lawyer
Category: Real Estate Law
Satisfied Customers: 12554
Experience:  I have practiced law for 25 yrs. with an emphasis on real estate, business law, criminal defense and family law.
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We are helping purchase a house children by taking

Customer Question

We are helping purchase a house for our children by taking a loan interest loan from my retirement. We will be putting 5% down as co-ownwer non occupants. At the end of a year we have agreed that the kids will pay us back when they refinance and we will remove our name from the title. What and how should we protect ourselves against losses or unforeseen catastrophes? Thank you
Submitted: 2 years ago.
Category: Real Estate Law
Expert:  Andrea, Esq. replied 2 years ago.
Hi, my name is ***** ***** I will be glad to Answer your question and address your concerns,
You asked,
"What and how should we protect ourselves against losses or unforeseen catastrophes? Thank you"
ANSWER - I understand and certainly appreciate your concerns. The only way that you can protect yourself from any type of catastrophe or against any loss is to be named as one of the insureds. However, here is where the problem arises - In order to be covered by any insurance policy, the law and the insurance company require that an insured have an "insurable interest". An "insurable interest" includes those who hold title to the subject property, or who have given a loan to those in title, and this is where the lender gets its right to require that it be named as one of the "insureds". You will also be one of the named insureds, but only for the first year during which you will be a "co-owner" ( and, of course as a lender to the extent of your 5% loan on the down payment) But, once the children repay you the amount you placed as the down payment, and you remove yourself from the title, you will no longer have an insurable interest.
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