Home Buying in Sangerville>Question Details

Robin, Home Buyer in Sangerville, ME

I dont't understand how this works. I can get approved to rent for 700 per mnth but not buy?

Asked by Robin, Sangerville, ME Tue Oct 12, 2010

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5
Hello Robin,

The difference is that if you don't pay rent, it is easier and less expensive for a landlord to evict you than it is for a lender to foreclose upon you because you didn't pay your mortgage.

I would recommend that you speak to the lender get a copy of your credit report, find out why you were declined for the loan and fix the issues.

Also, if you have only spoken to a lender at a bank, I would also recommend that you speak to a couple of mortgage brokers. Every lender is different and some of the brokers may have investors that have less stringent criteria than a bank or that offer government programs that may be able to assist you.

Best of luck,
Trevolyn
1 vote Thank Flag Link Tue Oct 12, 2010
I can owner finance my house in Milo.Please have a look at realtor.com 9 Pleasant st Milo Maine.Call me direct at 207-943-8794
0 votes Thank Flag Link Sun Jul 8, 2012
Have you thought about the additional expenses associated with owning a home that you don't directly have as a renter? You pay your $700 rent each month, and perhaps that even includes your electric and heat and your landlord maintains the property. As a homeowner, you have your monthly mortgage payment (principal and interest), most likely you will have to pay private mortgage insurance, homeowners insurance which your lender will require, property taxes which are determined by the town you live in, utilities including electric, heat, phone, cable, water and sewer (unless you have septic and well) and the costs of maintaining your home and your property. And before you even start with the monthly dollars, there are costs associated with purchasing real estate and obtaining your financing - - do you have cash saved for an earnest money deposit, home inspections, closing costs and down payment?
0 votes Thank Flag Link Wed Oct 13, 2010
Robin... as a previous poster noted, getting "approved" for a rental but not a purchase may well make sense... with rental, the primary concern is cash flow--meaning do you have enough income to make the monthly payment. With a home purchase a number of factors come into play: your totaly indebtedness, how that relates to your ability to repay, etc. The property you are considering purchasing is also a factor. I had a situation just today where a qualified buyer (credit and income-wise) was unable to purchase the home he wanted because the home needed some work.

Renting might actually make sense in your situation, at least for the short term. I'd beware of creative financing or private investors because it's entirely possible you'll pay a lot more in financing costs and, in the end, find yourself in an even worse situation. At the same time, if you have been unable to qualify for a mortgage for credit reasons, you would do well to get some objective advise and help. A good lender or credit counselor will be able to help you develop a program aimed at improving your situation -- sometimes in as little six months to a year. You won't necessarily have to pay for that help, either as long as you work with someone who's not just anxious to sell you a mortgage or a house. You want to find someone who will look at your situation and help you discover what makes the most sense for you.

I do work in the area and would be happy to make a couple of specific suggestions for folks you could talk with if you'd like.
Web Reference: http://boomsmaonline.com/
0 votes Thank Flag Link Tue Oct 12, 2010
I would agree with Trevolyn's comments below that it definitely makes sense to pursue a couple of different options as well as get a copy of your credit report. I would recommend reaching out a a couple local banks in your community perhaps?
0 votes Thank Flag Link Tue Oct 12, 2010
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