So You Want To Own Your Own Home?...But |
By Trey Patrick |
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Did you know that around 72% of Americans cannot qualify to buy a home the traditional way? And this number is increasing by the month. So where are you in this 72%... or can you get a loan the traditional way.
You know... go to the bank and apply for a loan and walk out with a loan.
These 72% are missing one or all of these requirements:
1) Large Down Payment
Unless it is your first house and it fits in the FHA or VHA limits, you are going to have to come up with some money on the front end.
2) Good Credit
You'll need a score above 580. And of course the higher the score the lower your rates will be.
3) Steady source of monthly income(and lookout if you are self-employed)
You are looking at needing stable income for two years at the same job or same profession.
If you are missing one of these (or all), what are you to do?
You could rent for a few years... You could rent and save up your money and then one day you'll have enough to get your own home.
NOT!
Renting is a vicious cycle. A cycle that will keep you too broke to save money... After paying the electricity bill, cable, car, living expenses, AND rent, it seems almost impossible to imagine saving the money you need to buy a house.
And you're not building any credit history.
The Solution:
Rent To Own Homes- Lease Purchase Homes
-You'll get 'rent credits' every month for a large percentage of your monthly payment. This is credited toward the price of the house and... some landlords will match whatever amount you pay above the regular rent.
-You are building up equity by having a lock-in price. You are getting a healthy portion of the future appreciation.
When you do physical improvements to the property you are developing 'sweat equity'. You could add a room, improve the landscape or finish a basement. Everyone of these are high-leverage improvements. Can you spell 'forced equity'?
Almost magically... you have built up equity and when you get ready for the loan- you have equity in the house and many times you can walk away with a 100% loan.
Now remind me again why you're renting?
Before you sign another rent check, before you invest another penny in someone else's financial security, you need to know you don't have to.
Copyright 2006 Trey Patrick |
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