The main reason why many sellers opt for seller financing--especially now--is that doing so opens their property to a larger pool of buyers. Some lenders are asking for ridiculous terms. Most investors I know (myself included) are unwilling to fork over more than 20% for a down-payment. Seller's typically don't ask for as much for a down-payment.
Lanny, whether you opt for seller or conventional financing, you'll need to understand the terms of your loan. Just as you could--and I'd argue that you should--negotiate on your terms for conventional financing, you can also negotiate on your terms for seller financing. Basically, the seller becomes the lender for seller financing, and basically everything else is pretty much the same.
I agree with Ms. Carr. If you can wait to buy for just a short time, I would suggest paying off/down as much of the bad credit as possible and still having at least 20% of the purchase price for your down payment.
Also, do get a loan officer involved now. They can help you repair your credit quicker than you can alone.
THERE ARE ALWAYS OPTIONS AVAILABLE TO PEOPLE IN THESE SITUATIONS, I STRONGLY SUGGEST THAT YOU MEET WITH A LENDER JUST TO REALLY SEE EXACTLY WHERE YOU SIT WITH THE CREDIT ISSUES ETC. AND THEN TALK ABOUT THE OPTIONS. MY FIRST CONCERN THOUGH IS THAT YOUR CREDIT RECORD WILL CONTINUE TO HAUNT YOU IF YOU DO NOT DO SOME TYPE OF DAMAGE CONTROL. ESPECIALLY TAX LIENS, THOSE WILL CONTINUE TO PERPETUATE AND WILL MOST LIKELY HAVE INTEREST PENALTIES THAT MIGHT CONTINUE TO GROW. IF YOU DO NOTHING ELSE AT LEAST TAKE CARE OF THE TAX LIEN, AS IT COULD COME BACK AND ATTACH TO ANY HOME YOU PURCHASE. THE BEST ADVICE IS TO REPAIR YOUR CREDIT AS BEST YOU CAN, BUT IF YOU CANNOT THERE ARE MANY OPTIONS. HAVE YOU CHECKED INTO ALL THE OPTIONS OF REPAYMENT PLANS, BANKRUPTCY, ETC.? YOU REALLY NEED TO MEET WITH A PROFESSIONAL ON THIS ONE AND WEIGH OUT YOUR OPTIONS. I SUGGEST TALKING TO A FEW DIFFERENT LENDERS TO SEE WHAT THEIR THOUGHTS ARE. I WISH YOU THE BEST, IF YOU HAVE THAT KIND OF DOWN PAYMENT YOU CAN REGAIN YOUR CREDIT AND EVENTUALLY GET INTO YOUR OWN HOME.
Brian Young 214-797-3479
Single family homes (no condos/units); owner occupied only
? Previous bankruptcies, foreclosures and short sales are OK! (1 day out, no seasoning!)
? 24 month Bank statements OK! (income sources/cash flow verified)
? No seasoning of down payment! it can be gifted or borrowed, even cash from a friend or family member
Ask me about our Mortgage Alternative Program.
We are are 100% portfolio lender(local community bank) which means we do not sell our loans(our own money and guidelines). As other lenders, we are a classic 4-C lender. We look at your character(credit), your capital(cash reserves/investments/retirement), the collateral(the type of the property and how much you are putting down, and your "capacity" to repay. We look at all those charateristics but we can make exceptions to these guidelines. Critical will be your credit explanation letter and how much of your delinquent credit is currently haunting you. A large down payment is a huge compensating factor but depending on your credit letter, we still may not be a good fit. Please contact us for futher details and perhaps furthur lending options.
A reverse mortgage, also known as a Home Equity Conversion Mortgage (HECM) is a relatively new product. A reverse mortgage provides unique benefits for its target market: someone over 62 who lives in his/her primary residence, who has substantial equity in his/her home, and who has little or no income. A reverse mortgage is a loan against the equity in your home that you don't need to pay back for as long as you live in the home. If an individual is a senior citizen and does not intend on moving out of his or her home for some time, a reverse mortgage may be an option worth considering. Eligibility is set by the Federal Government; The Federal Housing Authority FHA tells HECM lenders how much they can lend you, based on your age and your home's value. However, the up front costs and bank fees can be very high.To know more search
We see many credit reports with low credit scores (anything less than 620), and often many scores in the 500's. This is BAD credit. If you are one of the folks affected by this terrible economy, you have a low credit score and you have a dream of buying a home, here's some simple advice for you.
It is unlikely you could be approved for mortgage financing with that credit score at this time.
Beware of any mortgage professionals promising you an approval with such a low score. Wait on buying a home. I recommend you take the time to resolve your credit issues.
First, settle any outstanding debt. If you owe money on collection accounts, charge-offs and/or judgments, make payment arrangements and get these accounts paid promptly.
Next, begin rebuilding your credit. If you have current accounts with good payment histories, or even some previous late-payment-blemishes, make sure you continue to pay those accounts on time. If you do not have any existing credit accounts then you'll need to establish several in order to create a viable credit history.
I have found that CONSUMER ACTION is an excellent resource for objective advice on all things credit related. You'll find free and sincere advice on everything from settling collection accounts to rebuilding credit to building credit from scratch on their website.
Beware of anyone offering to "repair" your credit! The Federal Trade Commission issued a stern warning last year that such offers are scams. Find more from the FTC HERE.
The best way to buy a home is to have a decent credit history combined with sufficient Income and Assets for a home purchase.
The best way to have a decent credit history is to settle negative outstanding obligations and pay all your bills on time for at least two years.
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