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What other options aside from a mortgage can you get with a low interest rate to purchase a home? The reason being is 75%-80% of the purchase price is being put down and won't need $50K or more. Only need to borrow $20-$25K. Any suggestions on loans or how to make it work? Too bad you couldn't secure a home equity loan before the purchase
I've used credit cards and line of credit to buy rental property to avoid getting a mortgage. I then turn around and get a HELOC on the home and pay back the credit cards. When I said credit card, I am referring to those 0% balance transfer check that has either low to now cost transaction fee. You must have good credit and adequate credit line to play this game. Before taking out the BT, I make sure the balance is zero. Once I take out the BT, the card is put away and never used until the balance is paid off. There is a risk factor in playing this game. DON'T MISS ANY PAYMENT in any of your other accounts.
Citi have caught on to my game and have stopped offering me BT and closed half my credit cards.
What other options aside from a mortgage can you get with a low interest rate to purchase a home? The reason being is 75%-80% of the purchase price is being put down and won't need $50K or more. Only need to borrow $20-$25K. Any suggestions on loans or how to make it work? Too bad you couldn't secure a home equity loan before the purchase
You can get a 1st position HELOC for a purchse. Get a referral to a broker and they should be able to help you out with this.
1) Ask the Seller to finance the balance with a note. They'd likely secure it with a mortgage on the property, but the interest rate would be negotiable and you wouldn't have the costs associated with a regular bank mortgage. They would have the advantage of receiving a higher interest rate than they'd receive from having money in the bank.
2) If they won't take back a mortgage, ask the Seller to sell on a Land Contract (or the equivalent in Florida). The Seller would have the added security of knowing that the Deed to the property wouldn't transfer until the Land Contract was paid off in full. For your protection, you'd probably want them to execute a Deed and have it held in escrow pending fulfillment of the contract.
3) Seek a personal loan. A credit union might be your best option.
4) See if you can, indeed, line up a home equity loan, pending closing on the house.
I'd avoid credit cards unless you have a penchant for paying high interest rates (or if you are sure you can pay it off immediately). Also, make sure to consult with a qualified real estate attorney about setting up a Land Contract or purchase money mortgage (what a mortgage loan from the Seller is usually called). Hopefully, you have an attorney assisting with the purchase anyway.
I heard of people using credit cards an turning around and getting a heloc. I just thought if your debt to credit ratio was too high, it was cause a problem securing a loan. I know when were purchasing our home last time, they were encouraging us to take it even though we didn't think we'd use it. Right now, we have one but will lose it once we sell our home.
How strict are they on a helock now if the house is paid off? Our problem is our tax papers show self employment for the past 5 years and we don't make that much money. We've NEVER missed a mortgage payment in the 23 years that we've had one. All of our bills are current and we have credit scores over 800. I'm not sure we'd qualify and it's too premature to find out.
I had a great HELOC that I used several times with zero problems...
I called to request funds for a project... had to call and do wire if over a certain amount.
I was told I didn't have a HELOC
I said I most certainly do and went through the phone tree and learned I had cancelled it 4 months prior...
Now, I really needed to find out what was going on...
I went to the bank that issued it and was told they cancelled all the HELOCS and they coded it as if I did because it wouldn't reflect badly on my credit score...
How do you respond to that?
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