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My landlord of 3 years wants to sell me his house.

Me or my wife's credit exceeds the 625 fica score.  The landlord wants to sell because it needs a lot of work (built in the 60's).  My family and I are happy here, but we know that the bank would not loan us the money.  My landlord and I spoke 3 days ago, and wanted to know if there is an option to transfer the mortgage, or just keep paying him.  A down payment wasn't discussed, but I assume he would want one.  We make more than enough money to buy a home and still have plenty of disposable income, but that apparently does not matter to the banks.   What are some steps that we can take to make this happen asap?  We've been wanting to buy a house for 2 years now.  Any help is much appreciated.  Thanks!

-Jesse-
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September 10 2013 - Woodland Hills
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Hi Jesse,
I'm sure there's a lender that can do an FHA loan with 625 fico scores. You will need a 3 1/2% down payment and enough money to cover closing costs. However, the lender will determine the amount you can qualify for based on your debt to income ratio, then you'll see if you can buy this house or not. Please feel free to call me with any questions or concerns.
Liliana Alfonso
Realtor
Rodeo Realty
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September 10 2013
Be extremely careful when doing rent to own contracts.  They serve a purpose but can be very one sided favoring the seller.  

You mention it doesn't matter to the lenders; have you spoken with any?  I believe there may be options for you. 
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September 10 2013

Hi Jesse,
Best thing we can do is to compare all options: 1st) would be to transfer the mortgage, and we should look at the terms of the current mortgage
2nd) would be for you to be Pre-Approved, you can buy with as little as 3.5% down payment 3rd) If house needs some work, we can look into the 203k FHA program, that gives you up to $35,000 for certain repairs; above the purchase price. 
Question: What monthly payment would you be comfortable with?
There is also a way to offset your closing costs depending what price your seller is looking for.  Give me a call when you have the opportunity, we can look more into your options.

CARLOS PAREDES
Mortgage Consultant / NMLS: 233595
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GEM Mortgage, A Direct Mortgage Lender
Calabasas - Branch

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September 10 2013
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How about a land contract ? It's been years since I was a mortgage underwriter but at that time, land contract were popular amongst people who didn't have perfect credit.. Are land contracts still done ?
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September 10 2013
Hi Jesse,

I would recommend talking to a local real estate agent to give you some guidance on the purchase/sale process, I would recommend getting inspections, and an appraisal as well.

All the best,

Arpad

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September 10 2013
Based on your question being if you can not go the traditional way you do have the option of doing an All Inclusive Trust Deed (AITD) there are some pro and con's to it. 1 the lender may accelerate the loan payoff. Many investors use the option (some times it's called a wrap around). You do want to work with individuals that understand this option and explain it to the both of you. AITD will provide you title and allow you and the family control the property, and yes there will be and escrow, title, and all other services as you would have in a traditional sale. Hope this helps any additional questions please do not hesitate to contact us. 
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September 11 2013
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We've spoke to a lender already, and they told us that we needed to get our scores up a bit before a bank pre-approves us.  We are both prior active duty in the US Army, so we are eligible for the va loan.  Unfortunately, everyone that we speak to says we need better credit scores.  We got the house appraised 1 and 1/2 years ago, and it was priced at 475k.  He's trying to sell because he can't afford 2 mortgages, and this mortgage keeps going up for him, little by little.
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September 11 2013
With a 625 credit score you have options. Remember a lenders looks at two things. 1.  The buyer, 2. the property.  You have options but a property built in 1960 may have issues?  Remember buyer be ware.   
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September 11 2013
There are lenders out there that will take a VA loan with a 625 score as long as the other factors(capacity & collateral) make sense.  Keep looking at other lenders, but I would suggest not letting them pull your credit until you first qualify that your credit score it ok.

Best wishes.
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September 11 2013
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All the lenders tell us that they need to run our credit to get started.  One advised us not to use the va loan.  I don't really know what he meant by this, exactly.  I really thought the va was here to help the veterans. 
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September 13 2013
Talk to a lender to 1) What you/if you qualify for? 2) How you can improve your score.3) See if the seller will carry a second for you? 4) Never buy a house without representation from a qualified/experienced agent!! 5) If you reach to step 4, Then make sure you do all due diligence on the house....inspections etc!! Good Luck!!
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September 13 2013
We work with lenders that can accommodate many types of loans.  You should consider what you will ultimately pay for the home and the condition.  Make sure it is a wise purchase compared to what else is selling.

Aaron Scott
Rodeo Realty
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September 27 2013
One transfer mortgages - if the seller/landlord has two mortgages then there is a very very rare chance the loans would be assumable.   Always best to get your own financing though if the seller owned the house with no mortgages would be option to have seller carry the loan.   Meaning they would be the lender.   Though doesnt sound like that is options. 
Your current lender should be telling you what you can do to repair your credit scores.  Do you have outstanding debit?  Do you have down payment and closing funds, do you have funds to make repairs.   If you can get qualified for loan ... Is this the best option home for you to buy.   Are there other homes that may not need as much work or cost less.    What are the comparable homes selling for in the area.   Only a Realtor can help to answer some of these questions. 
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September 28 2013
 
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