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Creative Ways to Buy A House Creative ways to buy a house - One way to buy a house creatively would be to have the seller hold back a 2nd mortgage. For instance, if
you're buying a $100,000 house and your mortgage company approves you for 90% financing,
you'll still need to come up with $10,000. You could have the seller "loan" you the money, and you would pay them back in monthly payments just like any other mortgage. Check with your loan officer to find out if this type of solution would work for your situation. Check your states foreclosure market. There are often homes selling on auction for great prices. If you are buying a home from a relative you may qualify for a gift of equity. This is were the relative you are buying gives you a certain % of equity of the property as a gift. If you are buying a property for $100,000.00, but only qualify for 90% of the purchase price, the remaining 10% may be able to come in the form of a gift. Every lender has different requirements for a gift of equity, your mortgage broker should be albe to assit you in the requirement for such a loan. Another option is a 103 or 107 mortgage. These mortgages provide you with 103% or 107% of the purchase price, the additional 3-7% is used to pay for your closing costs. If you are lacking the money for closing costs on a home purchase you can have the seller provide you with a seller concession. A seller concession will usually be listed as either a percentage of the purchase price or a fixed amount and will be applied towards some or all of your total settlement charges. An example of this would be on a $100,000 home purchase and if the seller agrees to give you a 3% seller concession this would mean that the seller was going to pay for $3,000 for your closing costs. This is one creative way to help to buy a home when you don't want to or can't come up with money for closing costs. What should I be careful of when buying a home - When you are buying a home you should use caution before you sign a purchase agreement. Make sure you read over the entire purchase agreement to read exactly what is listed throughout and to see how exactly the wording reads for everything.
Don't let a Realtor tell you that it is a standard purchase agreement and they are all the same. Sometimes the purchase agreement may require you to pay for the buyer and sellers title fees. Sometimes the purchase agreement may state that you will not receive the keys to the home for many days after you have closed on the home. There are many other items that the purchase agreement may or may not state that you should be very aware of. Consult your mortgage professional or possibly even an attorney to review the purchase agreement so that you know exactly what you should expect. Although it can be more expensive, it is recommended to hire a professional real estate agent to help you look for a home. They are often familiar with the different elements to look at that may not be considered by anxious homebuyers. The additional cost at the purchase may save you tens of thousands of dollars in the life of your home ownership. Make sure you get an inspection done prior to closing. Often, the property will have problems that you cannot see. If the findings of the inspection are poor, use this to renegotiate the terms of the deal or to void the contract altogether. Be cautious if you decide to apply for a mortgage online. Many websites that appear to be mortgage lenders are actually lead suppliers that will take your private information and sell it to numerous mortgage companies. These companies may in turn flood you with phone calls and sales pitches from all over the country. To apply online safely, make sure the site is secure and make sure to read the companies privacy policy. The privacy policy should state specifically what will be done with your personal information. If the site is unsecured or has no privacy policy it may be best to apply elsewhere. Make sure you are not making yourself "house rich but cash poor". There are many loan programs that might allow you to get into a home that costs more than you originally planned for. While this may be tempting, be sure you understand all of the terms of your loan and of your situation.
If it is an adjustable loan when will it adjust and by how much might it go up? Can you afford the
payments if does adjust up? Is negative amortization allowed? Are you expecting your income to rise or stay relatively flat in the future?
Do not allow yourself to end up in a home you love but can't afford. Pick a home you like but that also is realistic for your financial situation. Buying a new home - Are you in the market to buy a new home? Are you thinking about selling your current home and upgrading to a bigger home? If so, then there are many factors to consider. Some examples are; should you buy a brand new (just built) home or an already existing home, do you have special needs (handicap accessible, certain number of bedrooms or bathrooms, etc...), school districts, property taxes, association fees, finding a quality and honest mortgage professional and many other things.
Don't let the home-buying process overwhelm you. Your first step in the home-buying process though should be to find a quality mortgage professional and this will help to insure a quick, smooth mortgage transaction and home acquisition.
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Information listed above is to be used for educational purposes only and is not guaranteed
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