Need Down Payment To Purchase House!
I am in dire straits. The owner of the house I am currently renting has just notified me that he wants to sell immediately. He is giving me the first option to buy. This house has been appraised for $410,000!!! I am going to need 10% down - $40,000. My credit rating is 580 or so (don't remember the exact score). I have been told that I could probably/maybe get preapproved for a mortgage that substantial through different mortgage programs with my salary but I will need to show at least 10% of asking price.
My question is this: can anybody offer any information on how I can acquire $40,000? I don't have that kind of cash. I found out that there are real estate investors who often go in on a real estate deal to have part home ownership without the hassles of paying mortgage and repairs, etc. At this point, I am willing to do whatever I need to do to obtain this downpayment! If I don't come up with it, the owner will sell and I (and my elderly, sick mom) will be out on the street as I have no place to go. I have made this house my home for the past 8 years. At the time of signing the rental lease, the owner swore that he was not interested in selling his house - EVER! Suddenly, he had a change of heart and wants to unload as soon as possible.
If ANYBODY out there can help me please feel free to shoot me an email. I am crying as I type this email - a true cry for help.
Thanks for listening.
Lisa
Where is this property located?
Verne
Lisa:
Send me your email address...I might be able to help.
Mark
**Please See My Profile**
Hi, Verne -
The property is located in Flushing, NY.
have you considered the following as possible sources of cash for the down:
-an insurance policy held by you or your mom that has a cash or loan value
-if you have been contributing to your 401K at work can you borrow from it
-change the number of tax exemptions that you are claiming at work so that you bring a little more money home (please note that most of us have paid our taxes by July for our income level and everything else after that is a "free loan" to the government - again check with your accountant about this)
-if you have had more than one job, did you leave behind "vested" retirement money that can moved/transfered to a retirement account of your choice (you can then take that money out as cash and use if for the purchase of the property. Time this type of cash movement carefully. It should be done right before the closing (WARNING!! THIS TYPE OF TRANSACTION HAS SERIOUS TAX CONSEQUENCES - SEEK THE GUIDANCE OF YOUR ACCOUNTANT BEFORE PROCEEDING)
- a family member can give you a gift of money for the transaction (the lender will want to see proof that the person moved the money from an active account
-go thru all of your pocketbooks and count the coins (I bet you can find $200 from this source alone)
-do you have any antiques or other collectibles that will yield some cash
-have you loaned money to people - call them and tell them you need it NOW!
-do you have someone that can or is willing to co-sign with you on the loan - or loan you cash for the transaction
-do you belong to a credit union and forgot about your account
-got 2 cars - sell one
-look for a "first time home buyers" program in your area - depending on your income you may qualify for a 3 -5% loan
Last but not least, talk to the owner let them know that you are interested and find out if they will finance a portion of the deal for 2 years. Remind them that you want the opportunity to go for this and you need a little consideration after 8 years.
Above all THINK! You may have other sources of cash around you that you have not thought about. Sit down and think about it! Stay calm and let us know how this works out - if you need more help ask for it.
Wish you luck. You can do it!!
Ligem:
Thank you so much for your suggestions. I have already exhausted some of the ideas you kindly listed. Others will be looked into by days end. I was going to place a call to the owner today to offer a lower price (as suggested to me by a real estate agent) but now thanks to you I am armed with more ammo. I will press the issue that I've been living there for 8 years and have taken great care of his property. I have a very good (friendly) relationship with him so I'm keeping my fingers crossed that he will be flexible.
Again - thank you for all of your help. Please keep your fingers crossed for me.
And please be free to shoot any additional ideas my way at any time.
Lisa
I do not know if this will help but, I work for a small unconventional lendor that strives to "provide financial solutions". Drop me an email with more information or call 800 876 6784 and ask for Gabe. Thanks.
-Gabriel Holmes
Just a shot in the dark, but maybe you could use a bit of creative real estate with him! Find out, since you are friendly with him, if he is behind on payments...Maybe you can take the property subject-to, and use a hard money lender to come up with whatever cash he needs to walk away! Even if he isn't behind on payments, he might be interested in a quick transaction..
Maybe he only needs $10,000.00 and owes less than you think. You could really get the house for much less by getting a bit creative!
Congrats!
Thank you Investorkim, for your feedback. I definitely have a lot more hope than before posting here. You guys have been so great in offering advice. It's really making a tough situation a little easier to deal with knowing that there are people out there who don't even know me personally, who are willing to help.
You will never know how much I appreciate you sharing your knowledge, experience and ideas with me.
Thank you a million times over!
Lisa
Lisa,
My first question is can you afford the payment?
If yes the you can ask the seller to carry a note for part of the money. With your score it is possible to get a loan, but the rate is not going to be low.
You could apply for a 80/20 loan, get 100% financing with no down payment.
You can also ask seller to pay closing costs.
However, just based on your credit score and the fact this would be a jumbo loan, your payments would be quite high
If your looking for mortgage loan, I would try to get seller to sell for $400,000 and pay for closing, this would increase your chance of approval but still no guarantees.
Email me if you any questions.
Why do you "need" 10% down???
Who's telling you this? Banks? The seller? realtors? (most likely all of the above....they're wrong, just in case you were wondering)
There are decent 100% LTV programs (or CLTV) for owner occupiied residences. NOT from Banks though...stop talking to banks.
Seller carry backs are CHEAP AND EASY ways to get financing.
Make him a partner. Allow him some of the appreciation until you cash him out.
BTW, how much is the house worth? the price?
buy sub. to.....easy, powerful, cheap.
use a partner
The bottom line is that you most likley DO NOT need 10% down. You need to learn more to find out how to implement these methods. 10%
...one more thought....
Not to be harsh, but no one here is feeling sorry for you when you're able to make the payments on a $410,000 house. You're not exactly "out on the streets" if it falls through, you're just in a different 1/2 million dollar home....or WORST case scenario a quaint little $200,000 home.
Sorry it hurts to have to move and I hope you get the deal to work out....It's just that your post merits little sympathy.
one more thing to think about is that if you just signed a lease, he cant make you move until the lease is up. You probably have more time than you think to gather the money unless a REI comes along and will carry the lease over for you.
[addsig]
Where are these programs that provide 100% LTV or CLTV programs that you speak of, that will work with FICO's in the 537-610 range? I've not found any in over two months of searching.
I work with many different lenders, including @1000 private investors. I can help you find financing. let me know if you're interested
he is flushing ny. sounds to me that it may be a 2 family or a dual income property....am i right ? if so he doesnt live and pay for a $400,000 home..
I also live in Flushing NYC, where 400K is average for a single family house. 500K - 700K is not unusual or uncommon.
Also, you need to be making in the six figures to be able to qualify for a mortgage for property at this price. The FICO score certainly doesn't help, but only if she has the income will she be able to qualify for a mortgage with less than 50% down.
My income is 45K. I am realistic to know that I will have to make serious sacrifices & put down close to $50,000 total cash (down payment + closing costs) on a 200K house or apartment.
I am willing to make those sacrifices because I know that my income will increase significantly in the near future. I am being underpaid in my present position (and industry) & only staying there for 'resume experience' only.
Wishful thinking is something that you shouldn't do in real estate.
I also live in Flushing NYC, where 400K is average for a single family house. 500K - 700K is not unusual or uncommon.
Also, you need to be making in the six figures to be able to qualify for a mortgage for property at this price. The FICO score certainly doesn't help, but only if she has the income will she be able to qualify for a mortgage with less than 50% down.
My income is 45K. I am realistic to know that I will have to make serious sacrifices & put down close to $50,000 total cash (down payment + closing costs) on a 200K house or apartment.
I am willing to make those sacrifices because I know that my income will increase significantly in the near future. I am being underpaid in my present position (and industry) & only staying there for 'resume experience' only.
Wishful thinking is something that you shouldn't do in real estate.
Quote:
On 2003-08-01 07:13, hibby76 wrote:
Why do you "need" 10% down???
Who's telling you this? Banks? The seller? realtors? (most likely all of the above....they're wrong, just in case you were wondering)
There are decent 100% LTV programs (or CLTV) for owner occupiied residences. NOT from Banks though...stop talking to banks.
Seller carry backs are CHEAP AND EASY ways to get financing.
Make him a partner. Allow him some of the appreciation until you cash him out.
BTW, how much is the house worth? the price?
buy sub. to.....easy, powerful, cheap.
use a partner
The bottom line is that you most likley DO NOT need 10% down. You need to learn more to find out how to implement these methods. 10%
If you can provide hardcore evidence that there are "decent 100% LTV programs" who will work with a buyer that has a FICO in the 580 range (and who likely isn't make a ton of money), please post it to the forum. Thank you.
{{{If you can provide hardcore evidence that there are "decent 100% LTV programs" who will work with a buyer that has a FICO in the 580 range (and who likely isn't make a ton of money), please post it to the forum. Thank you. }}}
Because such a program probably does not exist (except for a double digit hard money lender).
We do not know the OP's total household income. A 580 FICO essentially eliminates eligibility for any type of stated or no-doc loan, & even with 20% down, she will still need a mortgage for around 330 - 340K (with closing costs), & a qualifying income of close to 100K.
I think we should see the op's income info & debt/income ratios before making any other conclusions.