The Family Opportunity Mortgage Refinance

Cheerful woman with family standing in back yard

I’ve written about the Family Opportunity Mortgage for purchases where certain circumstances allow one to obtain a mortgage for a family member who is either a student in college, a disabled adult child or an elderly parent. The Family Opportunity Mortgages allows financing to be treated as a primary residence instead of an investment property as long as the scenario meets certain guidelines.  The Family Opportunity Mortgage is a Fannie Mae/Freddie Mac program that is also available for refi’s!

I’m currently working with a client who wants to refinance a home she owns that her elderly parents are living in. The Family Opportunity Mortgage allows for her parents to be able to live nearby and not have to meet the requirements of a second home (typically a minimum of 50 miles away from your current residence) or the higher interest rate and cost associated with an investment property.

Here are some of the requirements for the Family Opportunity Mortgage when an adult child is refinancing (or buying) a primary residence for an elderly parent:

  • Elderly parents must be unable to work or have insufficient income to qualify for the mortgage;
  • The parent must occupy the property as their primary residence;
  • The adult child may own their own primary residence;
  • Only “rate term” refinances are allowed. Cash-out or paying off non-purchase money second mortgages/HELOCs are not allowed;
  • Parent may be on the mortgage or the deed but is not required to be;
  • A written letter of explanation will be required from the adult child addressing the parents limited finances and intent with the home.

We are pleased to be offering the Family Opportunity Mortgage at Mortgage Master Service Corporation. If you would like a mortgage rate quote for a refinance or purchase on a home located anywhere in Washington, click here.


  1. Rhonda, We’re researching this type of loan now but are being told the parent has to provide tax returns and be on the mortgage and the deed. Your thoughts?

    • The program does not require the elderly parent to provide income or credit documentation. The elderly parent does not have to be on the mortgage or deed either. With Family Opportunity, you (the child) will need to write a letter explaining your parents financial situation.

      It sounds like the lender may not be using “Family Opportunity” and instead, is trying to approve your loan with you as “co-signers” for your parents. In that case, your parents would need to qualify and provide the documentation that is being requested.

      • Rhonda, thanks, I appreciate your input. What’s the best way to find a lender (in AZ) that will do this type of loan? Having a hard time finding someone…..

  2. Vincent Luis says

    Thank you so much for your article, Rhonda. How can I get more information on this Family Opportunity program? I have scoured the Internet but primary and authoratative sources are hard to come by. Thanks!

  3. Hello, Rhonda

    I was thinking about helping my father refinancing his house with me being a co signer. With our combine income will that help get approved since alone my father is not

  4. Hi Rhonda,
    I’ve been approved for this Family Opportunity Mortgage by a local lender. But when I received the paperwork to sign, the Occupancy Certificate was checked as ‘primary residence’ and I would have to occupy the property within 60 days. I decided not to get the house which would be for my mom. When using this loan program does the adult child have to state that he/she will occupy the property? And would that not be illegal?

    • Hi Scott, the lender requires that the loan be treated as if you were going to occupy it or have it as a “second home”. It is odd – but it is what the lender requires. I guess if you’re not renting the property, then it’s not an investment home.



    If you use the Family Opportunity program to purchase a home for an adult disabled child, can you charge the child or a roommate (who is not disabled) rent?



  6. Jeffrey Shulman says

    Thanks for your response, Rhonda. Our problem is that the disabled child will not be living in the property alone. So, our primary question is whether we can charge a roommate rent. Or, as far as you know, is any rental use of the property just out of the question?

    • Hi Jeffrey, I would need to check with the investor. If it’s a room-mate situation and the primary use of the home is for the disabled child, then I would *think* that it would be okay. If a couple rooms are rented, then it could potentially be an issue if the investor discovered the home was being used more as a rental.

  7. Hi Rhonda, thanks for the very helpful info. I’d like to refinance into a family opportunity loan for my parents and if I have them on the title but not on the mortgage, will there be gift tax due? I’m currently alone on the title. What if the house is paid off and I want them to be fully on the title? Will there also be gift tax due?

  8. Sankar Sridaran says

    Hi Rhonda,
    I’m purchasing a condo that I intend to rehab and make available for my aging father to live near us. The condo is one block from my primary residence. I will be using cash to acquire the property, then a DSCR/private loan or portfolio cash-out refi to fund the rehab, and finally would like to refi into a family opportunity mortgage after the rehab is complete. Would this be possible?

    • Hi Sankar Sridaran,
      Technically the “family opportunity mortgage” has been retired. Fannie Mae/Freddie Mac do offer expanded guidelines similar to the family opportunity mortgage to assist with elderly parents.
      You could possibly use conventional financing with the expanded guidelines to purchase the condo (depending on how much work needs to be done with the rehab). Bottom line, you should be able to refi.

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