Why would your relative not be able to buy a home if he/she will be putting down more than 20%? Does his/her income or credit score not support 500K loan?
This is precisely why a market adjustment and tightening of credit needs to occur. It doesn’t matter if you down 400K…if you can’t afford a 500K loan based on your income, then people should not be buying those homes. People have to learn to live within the means, I don’t think conforming loan limits need to be raised to allow buyers to purchase property that they cannot afford…bottom line is that your income/savings/lifestyle choices have to be sufficient to support your mortgage.
People don’t have to rent, your relative can still buy a home with 400K down…people just have to buy a home that they can AFFORD….no one if forcing your relative to buy a 900K home.
