Most Millennials Could Not Qualify for a Mortgage

Source: https://thinkrealty.com/millennials-mortgage/

One third of millennials who do not have a mortgage could use their prime credit score and this could help them qualify for one. According to the National Association of Realtors (NAR) and Experian data, only about one in six millennials has a mortgage. Of the remaining 85% of the millennial population, nearly two-thirds has a credit score of near-prime or worse. They may need to improve their personal loan and bankcard usage habits in order to obtain lower rates. This will affect millennial …

To stay updated with the latest information in the property investing industry to may visit our real estate latest news. On the other hand if you’re starting real estate investing and would like to start profitable property investing now get a copy of our profitable real estate investing ebook.

Are you contemplating investing in property? However you don’t have enough money to do this. Here is a tip you can use as long as the person selling the property is willing to negotiate with you.

To be fair, not every seller will be interested (or even understand) the concept outlined. Your better gamble is to find a land that the owner has great desire for selling, whether because they are moving, divorce, or they are frustrated with the folks renting the property.

Actually, if you are currently renting and considering using this technique perhaps your landlord would be glad to help you out! There are several variations that could be used depending on you and your owner. Do they want the market price or are they just desperate to get out of the monthly payments – perhaps facing foreclosure?

The simplest method is to take over their mortgage obligations – called ‘assuming’ the mortgage. You will have to be approved by the original lender to assume the mortgage. If you cannot get approved for an assumable mortgage you may as well try a ‘subject to’ assumption where you merely make obligations while the property remains in the seller’s name.

You take over the first mortgage and create a 2nd mortgage on the remaining cost of the house with the seller. Offer a high, interest-only payment for a short time period – two or 3 years. Instead of having the money sit down in a bank they could be collecting a high interest over two or three years with the rest due in full at the end of the term.

When the term ceases you ought to be able to refinance the cost, or you can sell. Unless you strike a genuine bad market the value of the house should have risen by then.

Most mortgage lenders merely want to make a good investment. While your local bank could still be scared there are plenty of financial lenders that would want to make a deal. Financiers prefare real estate. The mortgage is mostly based on 60-70% of the value of the property, so as long as they understand they get their money back in the value of the property if you default, they don’t care what sort of money you make. Complete the deal with a second mortgage done with the seller. If you default they could still foreclose on the property and sell it, paying down the existing mortgage with the proceeds.

Now you can see the whole picture. It is better that seller and buyer can work together. In the event they can’t wait for a sale, you may still give them their asking price with a little overall flexibility on their part.

Share This:

This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *