Tips For Buying A Home With No Money

by Rob K. Blake - Date: 2010-08-27 - Word Count: 520 Share This!

There is a popular belief that you can only buy a home if you have great credit. This is false because it is actually more difficult to rent than to buy a home. You can own a home today even if you do not have enough money.

It is not uncommon for many people to lose hope because they have poor credit status. You are simply uninformed so you must not lose hope. There are several government programs that will allow you to buy a home even if you have no cash and no credit. It is also possible for people with big credit problems to buy a home. All you need to do is to learn some creative financing techniques in order to become a new home owner.

Tips for People Who Are Cash Poor but Have Assets

Having cash, a good credit, and a perfect job are not the requirements for owning a home. This is the golden rule that you need to remember. Take note that there are no-money-down plans today and programs that allow creative financing techniques. You can easily buy a new home even if your financial standing is far from satisfactory.

It would be easier for you to acquire a property if you already have some assets. You can use these assets to obtain a mortgage loan even if you have little or no many at all. You can utilize creative financing techniques to easily convince the lender to give you the funds.

For example, if you want to buy a home worth $150,000, the logical thing that you can do is to approach a lender to request a loan for $120,000. Unfortunately, if you are going to borrow the $30,000 to pay the down payment, the lender will surely deny your application.

Borrowing money to pay the down payment is not allowed by most lenders. If the lender found out that you have borrowed money, then you will get instant disapproval. The lender will not treat you as a good credit risk because you can not even save enough money to pay for the down payment.

However, there are exceptions to this rule. You may borrow the money to pay the down payment if it is backed by an asset that you already own. Almost all lenders have no problem with this. So if you are cash poor but have some valuable assets, creative financing is best for you. You can borrow cash backed by the equity of a home. You may also have a classic car that you can make as collateral. Other valuable items in your home like high end stereo system or furniture can be used as collaterals to get a loan for the down payment.

Now that you have the cash to pay the down payment, a lender will certainly give the financing you need so you can become a new home owner.

There are also government home financing programs that only require six to seven percent investment from you. This is more good news for wannabe homeowners. You can start owning a home even if you have little money.

Related Tags: bad credit, mortgage reviews, buy a home with no down payment

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