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Answers (5)
Best Answer
- Kelly Wilson, "RealEstate Coach"
- Contributions:12
Steve is right. Another way to say it is that when you buy a house it is paid in full to the owner selling the property at the time of purchase. Either you pay it in full with all cash, or you get at lender to pay it in full for you (minus your down payment). Then the lender, who paid in full for you, holds the note on the house while you pay them back via mortgage payments over a number of years. When you have paid the lender in full then YOU finally own the house.... until then you are not the 100% owner which is why a bank can foreclose and evict you for non-payment.
There is another option called Owner Financing. When an owner finances the buyer, you pay your down payment to the owner/seller and you make monthly payments to the owner/seller until the house is paid in full. Any smart owner offering owner financing will give you a thorough credit check before they take on the risk of lending to you... But is a way to buy a house with out taking out a traditional mortgage loan.
Hope that helps, Kelly
There is another option called Owner Financing. When an owner finances the buyer, you pay your down payment to the owner/seller and you make monthly payments to the owner/seller until the house is paid in full. Any smart owner offering owner financing will give you a thorough credit check before they take on the risk of lending to you... But is a way to buy a house with out taking out a traditional mortgage loan.
Hope that helps, Kelly
- Khalil El-Ghoul, "Khalil Fairfax"
- Contributions:273
If you have cash to comfortably buy the property that could make sense, as long as that cash is not earning for you otherwise. If you buy cash you essentially finance yourself and would be earning interest on that money in the form of your own monthly payment saved. 5-10% return after repairs would be considered good. If you need that cash later to buy another house or car you could refi and take that money out as needed, assuming you qualify for a refi at that time.
Should also consider extremely low interest rates currently that may not be available at a later date. If it is your primary residence than of course you would not get to write off the interest if you do not take the loan.
Learn about the largest buyer rebate in the industry Google "Glass House Real Estate". 2% cash back.
Should also consider extremely low interest rates currently that may not be available at a later date. If it is your primary residence than of course you would not get to write off the interest if you do not take the loan.
Learn about the largest buyer rebate in the industry Google "Glass House Real Estate". 2% cash back.
- Nicholas Ribeiro, "NicholasRibeiro"
- Contributions:1807
I like it!
- Jim Starwalt, "jimstarwalt"
- Contributions:2512
Hi Theresa, Think of it this way, I buy your car from you and I have 20% down, do I just make payments to you? Or do I need to get a loan and hand you the entire amount we agreed upon for the car, then make payments back to the bank? This is he same as owner financing or a bank mortgage. You probably want the entire amount so you can take the cash to buy another car or do anything want. You want the money, you don't want to be a bank. I hope that helps, Jim
- Steve Withrow, "SteveMDDCVA"
- Contributions:22
I'm not sure I understand your question. If you're purchasing a property from someone...be that someone a builder or a private owner...they need to be paid the agreed upon purchase price for the property. The only way for that to happen if you aren't paying all cash is for you to obtain a loan. Otherwise...you are simply renting the property...
Forgive me if I'm not understanding...
Forgive me if I'm not understanding...
why do I have to have a loan at all? If I can put down more than the required 20%
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