Question: I have an interesting situation.
I am interested in buying the home I’m renting. The problem is that I don’t have very much income. I do own a home free and clear which I am renting out. This is my total income. I returned to college this year.
I have enough cash to put 5-10% down and the owner has mentioned doing the transfer without a broker. The problem is that the owners probably want to sell quick and not carry the mortgage. I don’t think I can qualify for a loan at my present income. I will be back at work within 2.5 years. Meanwhile, buying the house will save me money because I can write off the interest against the rent I am receiving.
What kind of creative financing can I find besides owner financing. I already talked to them about them financing for three years then I refinance. They are thinking about it but it doesn’t look good.
Answer: No Doc loans usually require a minimum of 20% down. Some also require proof of employment (not income) or self-employment.
Think about folks — would you lend money to someone with very little income AND very little equity? Doesn’t appear like a very sound loan to me.
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