It is not unusual for a bank to give a loan using the income of only one of the borrowers. If your father has sufficient income (it seems as though he does) then this should be no problem. However these issues need to be addressed by the mortgage professional before making an application:
a) Will the bank give a loan based on the credit/income of a Life Tenant alone?
b) Will the bank give a loan to a Life Tenant via a Power of Attorney?
c) Will the bank give a loan to a patient with alzheimers?
c) Will your bad credit as an owner prevent the loan from going through?
An experienced real estate attorney can point you in the right direction. Good luck to you and your father.
Note: This response is for general informational purposes only. No attorney-client relationship is created. No responsiblity shall be taken by the submitting attorney for any individuals acting pursuant to any information contained herein.
Most lenders will not lend on a property with a life estate. Based upon the facts you describe you would have to change the deed to get rid of the life estate and then have your father borrow the money. You can do this by putting the deed in both of your names with rights of survivorship which will extinguish the life estate then having him apply for the loan based upon his credit only. If the power of attorney you have grants you the authority to conduct real estate and banking transactions you should be able to do this with the power. If it does not grant you that authority you will have a hard time getting it done if your father is not able to understand the transaction and can not fill out the application and sign documents. You should bring the power to a real estate attorney first to see if you have the authority to make the necessary changes then consult with a lender.
This e-mail may contain confidential or privileged information. If you are not the intended recipient, please notify the sender immediately by return e-mail and delete this e-mail and all copies and attachments. If you are not the intended recipient, or the employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. IRS Circular 230 Notice: Unless specifically stated otherwise, any tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. Unless specifically stated otherwise, this communication shall not be deemed to be legal or tax advice, and no attorney-client relationship shall be deemed to have been created.
I think your question is better directed to a mortgage professional. Legally, if your POA is legit, you can encumber the property notwithstanding the life estate. Speak to a mortgage broker regarding your credit score and your likelihood of qualifying. You might have more success with a smaller lender or regional bank ( and a mortgage brokers can facilitate that) rather than a Chase. Your other option would be to go with a "hard money" lender at a high interst rate for a one or two year ballon product or interest only product with the idea that your credit score can recover during that time and you'll be able to get conventional financing to pay off the principal in two years.
My firm is a second generation family firm successfully handling personal injury and medical malpractice cases for over 35 years. "Let Our Family Help Your Family" www.kileylawfirm.com 516 466-7900