Home Buying in 78701>Question Details

Nini, Other/Just Looking in 78701

I moved to Austin 2 years ago and have paid $1125 in rent for a 2/1. I earn good money and have a very stable government job. I want to purchase a

Asked by Nini, 78701 Sun Mar 21, 2010

condo. My credit is poor. How can I purchase or find a lease-to-purchase? How can I find a realtor that is dedicated to helping me, although I don;t have great credit?

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In this current market, there are several developers and owners that are willing to entertain a lease / purchase agreement. Please note however that an attorney will need to draft the specific language since there is not a standard lease / purchase contract promulgated by the Texas Real Estate Commission (TREC). In the meantime, I strongly suggest you talk to at least 2-3 mortgage lenders or brokers to select one that you feel most comfortable with similar to your process in selecting the best match for a Realtor. In addition, you may want to consult with a credit analyst to determine the best strategy for improving your credit based upon your specific situation and the recommendations from your mortgage lender / broker. Several of our clients have successfully worked with Eddie Johansson <eddie@creditsecuritygroup.com>. If you decide to use a credit analyst, I suggest doing your due diligence such as checking with The Better Business Bureau <bbb.org>. The good news is you may find out that you have more options than you initially thought.
1 vote Thank Flag Link Sun Mar 21, 2010
Hi Nini,

Have you talked to a lender yet? The reason I ask is because I'm currently working with a couple who are moving to Austin and contacted me about finding a house to lease. We've been having a hard time finding a workable option because they have 3 dogs. I asked if they had considered buying instead. They said no because their credit union had told them their credit was too bad and they didn't have enough for a downpayment. I suggested they speak with a mortgage specialist and gave them a couple of names.

To make a long story short, they care now preapproved for a mortgage to buy a house up to $170K and we're starting to look next week.

Email me at carol@cararealtygroup.com or call me at 512-233-9004 and I'll be happy to connec t you with a couple of great lenders who can help you either with a mortgage today or with a plan to be in position to buy as soon as possible.

Lease purchases are not out o the question, but have some distinct disadvantages. Owner financing is another option, but also can be filled with peril. Bottom line is you don't want to get into a bad loan situation just to buy today.

Call or email and I'll be happy to talk about your specific situation and options.

Best Regards,
Carol Kerr
CARA Realty Group (PLR)
Web Reference: http://CARARealtyGroup.com
1 vote Thank Flag Link Sun Mar 21, 2010
Nini, I would work on improving your credit scores. As mortgage banker I could at least give you good advice on ways to do this. There is always the good advice of Perry Henderson or attack your credit issues with a vengence until your credit score is 600 or higher. My bank along with the banks we broker too have a minimum credit score for FHA mortgages of 620 and 600 for USDA mortgages. If you have any questions on ways to improve your credit scores or would like me to send you a current copy of your credit report, please let me know.
1 vote Thank Flag Link Sun Mar 21, 2010
Work spcifically with a Austin Realtor who understands how to "talk" with owners who don't yet know that they are willing to owner finance a home. I recommned Lora Herring lora@loraherring.com or Mary Beth Selden at mselden@austin.rr.com.

Good luck with your search.
1 vote Thank Flag Link Sun Mar 21, 2010
Nini. I am a Realtor and mortgage broker. I would be happy to talk to you about your situation. Your credit may not be as "poor' as you think...and FHA might be available to you. Lease purchase may not help much because you eventually need to have good enough credit to get a mortgage. Contact me if you would like to talk about it.
1 vote Thank Flag Link Sun Mar 21, 2010
Just how bad is your credit--FHA loans currently require a minimum score of 620 and 3.5% down--if you haven't visited with a qualified loan officer(s) yet, do consider it before beginning your search--see exactly what your budget can handle, check your credit score again--your officer may have great tips on how to improve your credit in the fastest time--in the meantime work diligently to repair your credit--pay bills on time, dispute old negatives, pay off old debt, pay down debt, keep credit cards below 50%, etc. Once you have established a budget, interview a couple of agents and choose the one you like best.
1 vote Thank Flag Link Sun Mar 21, 2010
Dear Nini,
Your best bet is to speak with a lender to see exactly what you will qualify for now. It is heartbreaking to go look at homes in one price range only to discover its more than you can afford Or discovering you have been wasting time looking at entry level homes and you can afford much more house. Do you have anything saved for a downpayment? Most lease purchase deals still have downpayments. You may be better off to stay where you are and work on your credit score and then re-visit the option of purchasing a home once your score has improved. It is easier to build good credit than repair bad credit. If you want more advice or need help please let me know. I would be happy to help you to find the right home.
0 votes Thank Flag Link Tue Dec 28, 2010
I am surprised I haven't seen a mention of the Wally Wrap... although Bryan came close! There are a good number of sellers that will owner-finance with the market still being tilted in the buyer's favor, so the key is to shop your options and follow Bryan's advice, then google "Wally Tingley" or "Wally wrap." Or click on the web reference below :-)

If you like the option, I happen to know of a condo or few downtown that could work quite well and save you the cost of originating a new loan, as well as jumping through hoops on fire to obtain lender approval, but definitely become familiar with and develop an understanding of the process (including the benefits and risks) involved in purchasing through a "lease purchase" or owner finance; I would then find a Realtor to assist you in finding the right property- most Realtors are more than dedicated to their clients, so you'll have many to choose from in finding the right fit!

Best of luck, and feel free to contact me to chat without obligation and/or discuss available property that may match your needs.

Warm Regards,
Kim Callaway
0 votes Thank Flag Link Thu Dec 16, 2010
Credit is but one indication of a buyer's ability to pay for a home and there are other ways that we can try to establish your credibility with sellers who are willing to finance your home purchase and I'd love to try to help you find empathetic sellers and "tell your story." After we give that a solid try, I can also introduce you to a group of investors who loan money to buyers for a short period of time while they are trying to get back on their feet financially and they don't require a credit check (this is a risky solution if you ever lose your income, though, so we'll explore all other options first). If we find you a really good deal on a home, you could also flip it at the end of a year and possibly make a profit. I have a great list of the best-priced homes in Austin right now so please email me and I'll be happy to help you!

Best regards,

Elizabeth Clark
President and Investment Specialist, Harvard M.B.A.
Austin Residential Properties
Email: elizabethclark@austinrp.com
0 votes Thank Flag Link Tue Mar 30, 2010
Nina, Let me know what areas you are interested in and I can try to find you all the owner financing available and send you the listings. Then we can go from there.
Mary Beth Selden
Prudential Tx Realty
0 votes Thank Flag Link Sun Mar 28, 2010
The blog below was written by Don Tepper. I have read his replies on here. He gives an excellent way to do this.

How to find a lease to own property below.
0 votes Thank Flag Link Tue Mar 23, 2010
Hello Nini,

Lots of good answers and I would agree that it makes sense to start talking to a lender and see where you stand credit wise. I am a REALTOR and a Mortgage Broker and would be happy to look at your credit situation. As a REALTOR I do not originate FHA loans which would most likely be your best fit but I also work closely with FHA lenders that can work with clients with scores as low as 580.

Wish you the best of luck in your home purchase.

Don Groff
REALTOR | Keller Williams
0 votes Thank Flag Link Tue Mar 23, 2010
Good for you about buying a home; everyone seems to be right about your first step is to get intouch with a mortgage professional. I am a mortgage banker and have nearly 20 years experience. I would suggest that you contact a mortgage professional and get your credit pulled. If you do this then you will know really how bad your credit is. I have had people who perceive that their credit was bad; but, when I checked it I found that it was not as bad as they thought. You sound as if you need someone to help you develope a plan; and, that is what I would do with you. If you have past collections that are on your report then you need some one who will tell you which ones to work on and others that you should just leave alone. Even if you should decide to lease purchase, it would be good for you to get your credit score up so that if you buy a new auto or major applicance the credit score affects the interest rate on the purchase of those items. Go to my website at TimHunke.com or give me a call at 512-762-4500.


Web Reference: http://www.TimHunke.com
0 votes Thank Flag Link Mon Mar 22, 2010
Well.... depending on your salary, you could use a MCC grant from the state of Texas. Also, how bad is bad? Are you at least at 600? Depending on your situation - you could work on it. Any agent would be willing to help you. Try to get prequalified with a lender and see where you are. Then go from there.
0 votes Thank Flag Link Sun Mar 21, 2010
Nini, my lender partners and I specialize in working with buyers such as yourself. We can evaluate your credit, debt, and income and tell you what you qualify for. There are no costs to you for this and we can try to get you pre-approved within 24-48 hours. Please click on my name to the right, look at my credentials, testimonials, etc. and contact me if you'd like some good, reliable, free Buyer Representation and advice!
Joe Jarusinsky, Realtor, Austin Business Journal Top Producer, Keller Williams Realty (512) 261-4415
0 votes Thank Flag Link Sun Mar 21, 2010
Hi Nini,
I agree with the other answers about checking with a lender first. They will run an in-file credit check for free. The lease-to -purchase option has pretty well been eliminated. A few years ago, our governor made a requirement that any purchase contract be completed within 180 days. There are several ways to do owner financing and I would be happy to tell you about them. Really, though, if your credit can be improved rather quickly, that is your best bet because then you can choose from all the condos on the market - not just ones that will owner finance or lease-purchase.
0 votes Thank Flag Link Sun Mar 21, 2010
Like most the answers below, I think the first thing you need to do is find out exactly what your options are regarding financing. There are ways to get your credit up to par-and when was the last time you checked it? And there are always Seller financing options too.
Let me know if you want me to refer you to a lender, but the first thing I would do is pull your credit report and see what you can fix first, sometimes it can take months, but some times it is a matter of getting old information off your report-which can just take a few weeks. If you have already done that recently, your first step is talking to a lender. They can tell you more about your options and what you can afford and a Realtor can help you narrow down those options.
As a heads up however, FHA guidelines are becoming more and more strict-which limits particular buildings in Austin, but there are always options.
Good luck in getting everything in line, but if you are dedicated to being a home owner, you can do it!
0 votes Thank Flag Link Sun Mar 21, 2010
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