Using Creative Financing To Purchase Primary Residence No $ Down?

I have been looking at this site for months now and am still learning and gaining the confidence to jump in with both feet. Right now though, I am interested in purchasing my own home but want to do so no money down. How would I do this? Thanks!!! :-?

Comments(11)

  • agilellc2nd April, 2004

    There are a lot of ways to creativly finance a deal. Doo you have a property in mind? Is the seller motivated to move the property? More details please.

  • ramgon12802nd April, 2004

    No, I dont have any property in mind. Just interested in hearing some available methods to consider should I find a motivated seller. I read on another post once about asking the seller to sell at 80% and carrying a note for the remainder. I still dont understand how that will contribute to making the deal no money down if I planned to finance conventionally. Or is that where I'm wrong?

  • destrie2nd April, 2004

    Ramgon keep me posted in I'm looking at the same thing as you are. I went to look at a deal yesterday where the owners were moving out of town and they are very motivated sellers and need to dump the property quick since they can't afford to pay two mortgages. I offered to do a lease option and since it needs repairs, I offered to buy prop at fmv and I would do repairs as part of down payment. (Sweat Equity). I also told them that I would need in the lease and the option to sublease it out. I don't know if that will work with you or not.

  • agilellc2nd April, 2004

    with doing an 80/20 with the seller holding the note on the 20. This allows you to get convetional financing at 80% which means you will pay nothing down. If you could also get the seller to pay closing you walk into the deal with zero out of pocket.

  • ramgon12802nd April, 2004

    Why is no down payment required at 80%?[ Edited by ramgon1280 on Date 04/02/2004 ]

  • mattfish112nd April, 2004

    The 20% your buyer would take back as a 2nd would look to the 1st mortgage holder as a 20% down payment on the property.

    This is how the 1st Mortgage holder sees it:

    100,000 sale price
    80,000 (1st mortgage)

    That's 20% down according to the Mortgage Bank, right?

    Good Luck!
    Matty Kling

  • ramgon12802nd April, 2004

    Oh I see! Thanks. Can you see any disadvantages to this method other than the difficulty of finding a motivated seller? What other methods can be used? Thanks

    destrie,
    Thanks for your suggestion. In purchasing my own residence though, I think I'd want to stay away from lease options though if at all possible.

    [ Edited by ramgon1280 on Date 04/02/2004 ][ Edited by ramgon1280 on Date 04/02/2004 ]

  • wwjam2nd April, 2004

    I'm doing an 80/20 deal now. My problem is that the mortgage co. is asking for a bank statement that shows 20% cash in it before I get the committment letter. Do I need to notify the mortgage co. that the seller is financing 20% and if so will they try to charge PMI?

    Thanks

  • j_owley7th April, 2004

    honesty is the best policy

  • galavotti13th April, 2004

    with an average credit score of 620, a $35K yearly income, I have a bank that will do 100% call me http://www.thecreativeinvestor.com/modules.php?op=modload&name=Forum&file=faq#rules[ Edited by JohnLocke on Date 04/13/2004 ]

  • ramgon128013th April, 2004

    I drove by a vacant home for sale by owner. I called the owner and she said it was newly remodeled and asking 118,000. Said there was a 1st for 74K. No leg work done yet, I was just looking for a house to have numbers to play with (and to get comfortable with speaking to sellers). How can I approach her with an 80/20 deal and assuming she accepted it, how would I present it to the bank and eventually cash her out? Basically, what would my proposal to her sound like? Thanks.

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