Home Buying in Raleigh>Question Details

HolidayDecor…, Other/Just Looking in Raleigh, NC

Is it possible to buy a house in these circumstances?

Asked by HolidayDecorGal, Raleigh, NC Tue Sep 18, 2012

I realize that its probably not very possible, but could I buy a house in my situation? I have no down payment nor would I be able to save up for one. I can only afford about 115,000 to 125,000 at the absolute max. I was wondering if it might be possible to get a loan for 115,000 or 125,000, but buy a house for less than that and use the left over money to turn the house into a livable state.

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Trevor Curran’s answer
Good evening,

Check out the USDA program for First Time Buyers. This program allows for mortgage financing up to 100% of the purchase price of the home and can include a Seller's concession to cover your closing costs. The program does not allow for extra money for improvements to the property.

The home you are purchasing must be located in a US Census Bureau designated "rural" area. Don't be deceived by the word "rural." You might be surprised to find these rural areas are within close proximity to major urban centers.

Best bet is to find a Local Mortgage Banker who is approved to provide USDA financing. Find one here:http://www.rurdev.usda.gov/HSF-About_Guaranteed_Loans.html

Trevor Curran
NMLS #40140
0 votes Thank Flag Link Thu Sep 27, 2012
Find a house for sale by owner in any price range you desire and complete a subject-to deal of the existing financing already in place with a land contract.
0 votes Thank Flag Link Thu Sep 27, 2012
I know of a contractor who works with renters to become homeowners - they buy, repair, rent and then sell to you. Very caring individuals who work hard and treat people fairly. give me a call and I will introduce you. Jay Music Realty 919-946-2900
0 votes Thank Flag Link Tue Sep 18, 2012
The possibility lies in where you are looking to purchase your home and what you need versus what you want in a house. If you were to go for a USDA loan in areas that qualify (Johnston County), and consider using the"203K program', you could. You coud also find a home in your price range in the USDA areas, certain locations in Johnston County. You would need a reasonable credit score- if you havent pulled your credit report lately thats the first thing you should do so you know before you walk into a credit or load office what youre dealing with and they can help you get to where you need to to qualify for a loan. If you havent pulled one at all or within the last year you can have it for free otherwise it will cost a few dollars - http://www.annualcreditreport.com.

I can certainly put you in touch with a number of credit people if you should decide to want to pursue a USDA loan. Please feel free to call or email me and I will be glad to help you you. Have a great day!.
0 votes Thank Flag Link Tue Sep 18, 2012
It is possible to buy a home under your circumstances, going with a USDA loan in areas that qualify, and by utilizing a special program called "203K', which allows you to roll renovation costs into the loan. You will need a middle credit score of at least 600, most likely.
0 votes Thank Flag Link Tue Sep 18, 2012
This might be a better question for the mortgage people. From what I see, it will depend on your credit score and employment situation; that is, you have a stable work history and a salary that supports the loan payments. You should be able to find a place that is move in ready for that price, so long as you have realistic expectations. I can share some information about no money down programs if you contact me. Good luck!
0 votes Thank Flag Link Tue Sep 18, 2012
There are loans available to repair a home (FHA 203b), however, there is much more info that would be needed to know about your circumstance.

I recommend first pulling all 3 of your credit reports at http://www.annualcreditreport.com. It'll cost a few dollars to get your scores, however, those scores generate the most action. You'll want to have any wrong information corrected.

Talk with the mortgage department of your current bank or credit union. It appears that both FHA (3-5% down) and USDA (100% financing) may both require any medical bills to be paid before issuing a new loan.
0 votes Thank Flag Link Tue Sep 18, 2012
As Mark stated, you would be best to look for properties that will accept a USDA loan. USDA loans are typically limited to more rural areas so if wanting to live with a city limit, they most likely will not be available to you. I did this with my son and between the 100% financing and closing costs that were negotiated for and paid by the seller, he virtually put nothing out of pocket and actually got money back at the closing. In todays world of Due Diligence transaction, you may need up to $200 to get started.

Talking with a lender is your first step to fully understand what you qualify for. I have been working with a couple of specific lenders since 1994 who are excellent, thus the long term relationship. They could also discuss options with you about any repair $$ you may need. As well, there are some nice homes on the market in that price range which may require not require any work.

If I can be of any assistance to you, please call me at 919-795-5447. In the meanwhile, please feel free to visit my website at http://www.RaleighHomeSite.com. I have a couple of homes in my FEATURED LISTINGS section which may interest you plus you can search for all homes available in our area.
0 votes Thank Flag Link Tue Sep 18, 2012
The only local lender I know of offering 100% financing (which is what you're asking for) is the State Employees Credit Union and you have to have access to them (perhaps a family member?)

As for getting a loan for more than the purchase price, you can forget it.

I understand your desire to buy a home, but three things are required to get a mortgage,.
Credit Score - Assets - and Income You have already indicated that you don't have any real assets (money to put down) and have said it's unlikely you could save this up. I'll be honest and tell you you probably should not buy a home as you could easily find yourself in over your head when normal maintenance items came up such as replacing a roof, or AC unit etc. I feel like I'm raining on your parade which I don't enjoy doing but I'm just trying to be realistic and honest with you.
0 votes Thank Flag Link Tue Sep 18, 2012
There are a number of factors that are involved in getting approved for a mortgage. Don't be afraid to reach out to a lender to ask questions. If for some reason you can not get approved now, many lenders can guide you in the right direction on how to get approval in the future.
If you need a good lender I would be happy to provide you with a couple. Just message me directly.
0 votes Thank Flag Link Tue Sep 18, 2012
A USDA loan will offer you 100% financing but they typically require you to bring some money to the table just to show you are serious and have some teeth in the process. This amount is typically not too much. But it sounds like what you are referring to is a construction loan or rehab loan which would more than likely require you to put down some money.

I would suggest you talk to a lender regarding your situation. I have a few great ones I could recommend you and if you will email or call me, I will provide you with their information. I wish you the best and hope to be of service to you. Please let me know if there is anything else I can help you with!

Warm Regards,
0 votes Thank Flag Link Tue Sep 18, 2012
I think your homebuying strategy may be problematic. If may be better to buy a small home that is not in need of extensive repairs as you state you a have little to no downpayment funds available. A lender might be more favorable to a home that has immediate resale value, not a a fixer upper.
Flag Sat Sep 22, 2012
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