Posted on: 22nd Jan, 2008 08:17 am
how would owner finance help the buyer if they dont have the down paymnet an closing cost
Hi Eitjimny,
Welcome to the forum.
I think you have to pay the down payments and closing cost even you go for owner financing. The advantage that you can get in owner financing is that you may get approved even with lower closing cost and smaller down payments.
Now have you decided to go for owner financing? Are you a first time buyer?
I hope there are lots of more questions to come from you. So feel free to ask :)
Best of luck,
Larry
Welcome to the forum.
I think you have to pay the down payments and closing cost even you go for owner financing. The advantage that you can get in owner financing is that you may get approved even with lower closing cost and smaller down payments.
Now have you decided to go for owner financing? Are you a first time buyer?
I hope there are lots of more questions to come from you. So feel free to ask :)
Best of luck,
Larry
Welcome to the forums!
With owner financing, you can use the money for down payments, closing costs, etc. Keep in mind though that not every lender is going to allow it. You have to tell them where your down payment and closing costs come from (typically). Most lenders that do allow it will still want you to contribute something to the deal, normally it is no less than 5% of the loan amount.
There are many ways to structure owner financing. And the seller normally has to follow the same laws a lender needs to when offering such financing. Ie. there must be an interest rate, etc.
With owner financing, you can use the money for down payments, closing costs, etc. Keep in mind though that not every lender is going to allow it. You have to tell them where your down payment and closing costs come from (typically). Most lenders that do allow it will still want you to contribute something to the deal, normally it is no less than 5% of the loan amount.
There are many ways to structure owner financing. And the seller normally has to follow the same laws a lender needs to when offering such financing. Ie. there must be an interest rate, etc.
it's hard to tell from the original post whether this is referring to all of the financing coming from the seller, or a portion from the seller and the rest from an institutional lender.
if it is all seller-financed, there may be a benefit in high-interest-rate times, but less so these days, with rates as low as they are now. one of the detriments is no escrows, meaning you would have to pay taxes and homeowners' insurance bills separately as they become due.
if it is all seller-financed, there may be a benefit in high-interest-rate times, but less so these days, with rates as low as they are now. one of the detriments is no escrows, meaning you would have to pay taxes and homeowners' insurance bills separately as they become due.
