Home Buying in Sacramento>Question Details

Rosalind, Home Buyer in Sacramento County, CA

Are there mortgages on properties below $50.000. My credit union will only offer a mortgage starting at this amount. Are these properties all cash?

Asked by Rosalind, Sacramento County, CA Sat Jul 9, 2011

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Shop around, try Vitek or Comstock or a mortgage broker. Many lenders don't like to do small mortgages, but they are out there, but yes many of those properties are purchased for cash or with a private loan (family, friends)
0 votes Thank Flag Link Sat Jul 9, 2011
Rosalind,
what you should know about homes at a low price,...
Many people who work in the real estate business, get paid on percentage.
Loan people and real estate agents for a start.
When the loan amount or the purchase amount is less than 100,000 you will find it a bit more difficult to find help at times. here is why on a real estate agents perspective.
home lists for sale for 50,000 and lets say it sells for 50,000
there is usually around 6% commission split between two different firms. FYI that is around 1500 each firm.
Now each firm has to share that with the sales agent, so your agent may make around 750 give or take.
That is for showing you properties for x number of days work, doing a real estate agent inspection, going to the inspection, assisting with making sure all is running smoothly for a month after escrow begins,....
Now ask yourself would you work for on average around 45 days for around $750?
Loans have similar situations.....
In answer to your question,....
Cash would be the way to go.

Harold Sharpe - Broker
So Cal Homes Realty
(951) 821-8211
harold@socalhomesrealestate.com
http://www.banningcaliforniahomes.com
California Department of Real Estate Broker License # 01312992
2 votes Thank Flag Link Thu Jul 21, 2011
Generally, any bank or credit union don't make loans for $50k and under. However, these homes are purchased by investors for cash. FYI... homes also in this price range need A LOT of work! My suggestion is to contact a few local banks and or credit unions. I, myself, have worked with Comstock, Umpqua Bank, and Five Star Bank. These all have local offices you can speak to a person about applying for a loan rather than an on line banker. I would also look at Home Path homes if you don't have a lot of money to put down. These homes are great deals for any buyer.

Nancy Bergman
DRE #01893550
Century 21 - Noel David Realty
Agent
Direct 916-400-1355
Office 916-967-2200
http://www.sachomesbynancy.com
1 vote Thank Flag Link Sun Jul 10, 2011
The revisions from earlier this year have caused a lot of lending institutions to revamp minimum loan amounts. I think my own mortgage broker doesn't handle anything under $65,000. So the fact that a credit union will do at mortgage at $50,000 is pretty good.

If you want a loan under $50,000, you might have to go the unsecured route.

Elizabeth Weintraub
Broker-Associate #00697006
Lyon Real Estate
1 vote Thank Flag Link Sat Jul 9, 2011
Harold gave a great and thorough answer, and his analysis matches some of my experiences. Yet, it's also possible to get financing on properties below $50K through other sources, and I'll focus on the private sources. Some investors (myself included) will sell properties with owner financing, and some of us may work with borrowers in other ways to acquire these kinds of properties. The key difference here is that we operate using a different business model, and our compensation isn't primarily based upon loan fees or commissions.
0 votes Thank Flag Link Thu Jul 21, 2011
In this price range, Visa Card, Mastercard, American Express deserve consideration if you have that kind of a credit line.
0 votes Thank Flag Link Wed Jul 20, 2011
Jim Walker, Real Estate Pro in Carmichael, CA
MVP'08
Contact
Generally loans below $50,000 are too small for most lenders, since the documentation needed for most loans are the same, and the smaller ones yield less revenue for them. We do, however, have programs, so give me a call or e-mail as@washingtonreal.com

Al Som-Anya
Broker, President
Washington Co. LLC
916.675.1177 x 1000 Office
866.405.3887 Fax
916.494.2255 Mobile
CA DRE# 01738867
NMLS # 394956
http://www.washingtonCollc.com
0 votes Thank Flag Link Sat Jul 9, 2011
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