David Foster's Daughters Erin and Sara 'Love' His Fiancée Katharine McPhee: Source

They’re just one big, happy family!

David Foster‘s daughters Erin and Sara couldn’t be more thrilled that Katharine McPhee will be their new step-mom.

“They love Katharine, and they’re happy about the engagement,” a source tells PEOPLE of the sisters, who starred in the VH1 reality show Barely Famous.

“Of course they joke about the age difference,” the source adds (Erin, 35, and Sara, 37, who are both older than McPhee, 34), “but she’s so sweet and really gets along with the family. She’s spent a ton of time with them. No one has anything bad to say about her.”

Adds the source: “They love their dad — they jokingly call him a ladies’ man, but they have a good time with it. There’s no bad blood.”

This will be the fifth marriage for Foster, 68, and the second for McPhee.

In early July, the music producer and Waitress actress announced their engagement on social media following his proposal on a romantic trip to Capri, Italy. The music producer and American Idol alum first sparked dating rumors last September but didn’t confirm their relationship until they attended the Met Gala together in May.

Foster’s daughters were some of the first to congratulate the couple — and poke fun at their engagement.

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After McPhee and Foster shared the news on Instagram, Erin left a comment in which she called McPhee “Mommmyyy”; later, Sara also got in on the laughs, writing, “Out of the country. What did I miss?”

Though they weren’t romantically linked until last fall, Foster and McPhee have been friendly for years — and the Grammy winner actually performed at her first wedding to Nick Cokas in 2008. (She and Cokas split in 2014, then finalized their divorce in 2016.)