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* Pay 30% more than fair market value
* Lock in an interest rate of at least twice as high as current market rate
* Put at least 10% down - but more likely 20% and up
* Have to show good credit, pay stubs, 2 years tax returns, etc. to qualify
* Tend to wait to buy while your credit gets repaired after discovering all of the above
If asking from a seller point of view:
* Consult an attorney before you list
Info on Lease Option or Rent to Own:
Criminal Credit Repair:
Down Payment Assistance in KY:
If the property is free and clear, meaning the seller has clear title without any loans, the seller might agree to carry all the financing. In that instance, the buyer and seller agree upon an interest rate, monthly payment amount and term of the loan, and the buyer pays the seller for the seller's equity on an installment basis.
The security instrument is generally recorded in the public records, which protects both parties.
It means that the owner may be willing to be the "banker" and extend financing for a while. This can be a good option for a buyer who currently doesn't qualify for conventional financing but believes they will be able to in the near future. There are no set terms; they can be whatever the buyer and seller agree to.
For a buyer, it can mean getting a loan. To the seller the rate and down payment typically reflect a better return than they might get in the market.