I am a FIRST-TIME homebuyer interested in a FORECLOSED house in Mansfield, MA. The asking price is $165K. The house needs a lot of work. To get a return on investment, I was thinking of offering $125K with 20% down.

My parents thought it would be a good idea if, instead, they offered $100K on top of my $25K and paid for the house with cash in their name. Is there a way that my parents can immediately get paid back?

Could they buy the house in their name, then I take out a mortgage and buy it from them? Or would that exempt me from the first-time buyers credit? Could they "loan" me money so I can purchase the house (and get the credit), then I would take out a personal loan to pay them back? Could that personal loan be lumped into a construction home to cover the costs of renovation?

Basically we want to put a strong cash offer on a foreclosed house, but my parents need their money back. Any advice would be great. Thanks!

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 Tags: first-time buyer, tax credit, cash offer, foreclosure

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