Author: Jay Redding

(5)   Articles
Jay began his real estate investing career at the

Articles by this author

Top Rated Articles

Wedding Invitations Don'ts

By Sarrah Beaumont | 5 Rating | Published 2009-07-21 18:24:23

Much is already written regarding weddin...
Read more..

Car Bodywork Paint Repair Restoration Techniques - Spray Painting

By Mario Goldstein | 5 Rating | Published 2009-07-22 21:11:32

When buying a car one of the biggest cho...
Read more..

How Do I Make My Home Insurance Company Hurry Up?

By Anthony Peck | 5 Rating | Published 2009-08-07 05:45:36

Is there anything more frustrating that ...
Read more..

Do You Really Need Car Insurance

By Warren Fets | 5 Rating | Published 2009-08-21 03:45:27

There are many advantages to having car ...
Read more..

So What Do You Really Know About Fashion?

By Benedict Smythe | 5 Rating | Published 2009-08-24 15:48:39

Fashion is extremely seductive, slightly...
Read more..

Creative Financing for Real Estate Investments By Jay Redding

  in | Published 2010-09-20 20:50:47 | 524 Reads | Rating 1

Summary

In an historically bad economy like this one, there is no shortage of motivated sellers, which means there is no shortage of opportunities for buyers to get creative with their financing terms.

Full Content

 In an historically bad economy like this one, there is no shortage of motivated sellers, which means there is no shortage of opportunities for buyers to get creative with their financing terms.  In many cases, investors with little or no credit can arrange to purchase a home, with little or no money down, and with no new loans.  The nature of the slow market (the buyer’s market) is that it allows buyers to take advantage of opportunities while working to improve their credit and acquire funding for a down payment.  Here are a few ways t
o go about this.

      The first option is the lease-to-own route.  This is when a property owner rents the property to a tenant who intends to buy, but can’t afford to make the down payment or take out a new loan.  Every month, a portion of the rent is put towards a down payment on the home.  No loan, no detrimental credit impact, a place to live, and time to secure funding.  Generally, the contract will extend between 2 and 5 years, will require a small down payment on the home (3-7%), and will put anywhere from 10-50% of the rental payment towards the purchase of the home.  At the end of the contract, a mortgage loan (substantially reduced from the initial purchase price) can be obtained to cover the balance.  It’s pretty simple, but lease-to-own’s provide some incredible ownership opportunities to those who, in better economic times, could not hope to put together a competitive offer on the property.

      Another option which balances motivated sellers and small loans is what’s called a seller carry back mortgage.  This is basically when a seller agrees to act as the lender for a mortgage loan, allowing the buyer to complete the purchase and then repay the seller over the course of a few years.  It is very rare for a seller to agree to finance the entire purchase, but surprisingly common to find terms of partial seller carry back mortgages.  In these cases, the buyer takes a primary mortgage loan from the bank (one which is much smaller and easier to acquire than the loan for the entire purchase price), and a second mortgage directly from the seller.  This requires cultivating a pretty solid relationship with the seller, so bring your “A-game” when you follow leads—especially if you’re short on credit or cash.

      There are many opportunities to simply find good deals—houses listed and sold below market value.  Be it through foreclosure auctions, probate sales, short sales, or creative financing terms, anyone can buy right now.  After all, it’s called a buyer’s market for a reason.  Use your head, not your money, and you can find a path to home ownership that won’t leave you destitute and with crippled credit. 

Let us know what you think. J 

InvestmentPropertyMadeEasy.com 

Comments

replica watches for sale :VIERA NeoPDP full high definitionPlasma has crystal clarity, sharper pictures, as well as fast, bright, dynamic pictures - Game Mode provides an even fasterpicture response time. http://www.watcheswill.org/bell-ross.html

Add Comment:

About the Author

Jay began his real estate investing career at the beginning of 2005. He has been a full time investor since 2007. His business focus and specialized knowledge is in rehabs, lease options, rentals, fix and flips, discounted turnkey cashflowing properties for passive investors, wholesale properties, self-directed IRA investing and basic asset protection.