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The Basics: Home Buying 101
You need 3 things to buy a house -- good income, good credit, and some cash. And
if you lack any one of those, sometimes even if you lack two, there is often a
way around it.
After all, if you have enough cash, income and credit won't matter. You can simply
pay cash for your home. If that's your situation, you're in a strong negotiating
position and can sometimes buy at a bargain figure because you represent a sure
thing, a simple transaction, for the seller.
What if you have good income and credit, but lack money for down payment and
closing costs? Several options are open to you. For starters, veterans can
obtain a VA-guaranteed loan with no down payment at all. And if you can find sellers
who agree, the VA will allow them to furnish the cash outlay you need, covering
everything from bank points to your prepaid property taxes.
Any buyer can apply for an FHA-insured mortgage, with down payment of less than
3%. New regulations allow the down payment to be furnished by a relative. Some
of your closing costs (prepaid mortgage insurance premium, for example) may be
financed along with the rest of the loan. And a cooperative seller may agree to
cover some of your other costs.
Or perhaps you'll find a seller willing to "take back" financing --
let you pay month by month on a mortgage, with nothing down and minimal closing
costs. You'll need a sterling credit record and really dependable income before
a seller is likely to take such a chance on you. It will help if the seller doesn't
need immediate cash. Small income properties owned by elderly landlords who are
tired of managing tenants are likely bets.
In recent years, many new programs have offered special opportunities for those
who can't meet the usual credit qualifications for mortgage loans. Some of
these programs are federal, others are state-sponsored or even local. Some require
you to receive credit counseling and attend education seminars on how to manage
money. Your real estate agent should have information on what's available in your
area. |
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As
your Real Estate Specialist, our job is to help you..... help you find a
home that meets your lifestyle, location and budget requirements within
the time frame that you need to purchase and occupy the home. 
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