For the past 18 months, Ive been renting a friend’s condo for 0 a month. Now Im interested in purchasing it. It has an appraised value of approximately ,000-,000. I know he paid about ,000-,000 for it in 2007.
In 2008, I settled (not bankruptcy) my credit cards and in doing so, my credit score dropped from 800 to 600. (so Im not sure about going the conventional home loan route) However, my income is ,000 and my monthly debt decreased to 0 (so needless to say, I can afford to buy)
My friend is more than agreeable to sell it to me at a good price and he has even offered to rent to own/in house finance with me.
Based my situation, what is the best/easiest way to make the purchase without going through the traditional loan process?
Have an attorney draw up a lease purchase contract and buy direct from the owner.
The contract protects both of you if a disagreement occurs in your friendship.
I would go through a traditinal loan process if you need a loan.
They will do appraisals, inspections, title searches, and lien searches.
It will be a good idea.
Note: Your score is not everything when it comes to financing a home.
When you paid off the items – it did not improve your score – but it improved your reports.
Did you know that major lenders like FHA do NOT look at scores.
They will review your reports in detail and notice the items as "paid" in full
They will act accordingly.
That is why you see people with scores lower than 600 get morgtages.
They cleaned up their credit reports.
And… they have a solid down payment.
Do you have 20% down?
Enjoy your new home and your new mortgage.
Other idea:
Save for 6 months and buy that condo for cash.
All you will need is a lawyer to draw up the papers.
Never go without the title search, lien search, home inspection and appraisal.
/