Are their any options HELP - Posted by Ron St.louis

Posted by Ron St. Louis on July 14, 2001 at 17:53:27:

the grant money total is 5000 , no matter the price of the home , I can put up “0”. I can only use for home purchase. I have not seen the preapproval letter as yet , It will have it on Monday. There are 2 approval’s , one for 85% I provide 15, one for 80% with a max from owner of 6%(down payment). Thanks I shall read about “subject to”. This is what I enjoyed about this site the FOOD for THOUGH. May need to check the info on “LO”???.

Are their any options HELP - Posted by Ron St.louis

Posted by Ron St.louis on July 12, 2001 at 18:06:19:

I’m in a buy out area. the gov. will supply up to $5250 towards closing and / or downpayment. I have bad credit. Got approved (conventional (11% bad credit)) for up to $75,000 total with 20% down / by two lenders. My problem I still have to make up the diff. for the down and closing. I can come up with $1800 / 3000 extra. Should I find a private home owner. Find a smaller home amt? I would need up to 15000 for 20% of 75000. (yes no )? I’m not good at this (smile). Would like to not lose the grant money and get a home. I was told this is the site please help. THANKS

Re: Are their any options HELP - Posted by SHAUN IN STL

Posted by SHAUN IN STL on July 12, 2001 at 23:14:08:

What area of St Louis are you looking to move too? I am assuming you are part of the airport expansion buyout? I am an investor(here in St Louis) that may be able to help you find the house and financing you are looking for. Please feel free to contact me and I will do my best to help you out!

Re: Are their any options HELP[long response] - Posted by Ronald * Starr

Posted by Ronald * Starr on July 12, 2001 at 21:49:11:

Ron St Louis-------

I’m having a hard time figuring out your situation and question(s). Perhaps you are trying to be too brief in your description.

If I understand you right, you can borrow 80% on the purchase of a home with a value of $75K or less. You yourselft can provide somewhere around $1,800 to $3K of the downpayment money and the government will supply some more. The amount that they will supply is limited to $5,250. How is the amount that they will supply determined? Price of house? Amount of money you put in? Something else?

IF you can put up $3K AND they will supply the maximum of $5,250, you can put up $8,250 for both closing costs and down payment. You don’t mention what your closing costs might run, especially the loan fees. So I will guess that they might run about 3.5% of the purchase price of the house. Then, you have to have 20% of the purchase price also, for the closing costs.

Working with these assumed figures, you can purchase a house costing X dollars. X muliplied by .235 equals your cash position, which is $8,250. So, dividing your cash position by .235 equals X, the maximum price you can pay. (Boy, I feel like I’m turning into JohnBoy here. Hope he doesn’t rebuke me for using his techniques to answer the question.) The answer right at $35,000. So, if you can scrape together the three thousand, this is about what you can afford if all my assumptions are approximately correct.

How long is your grant money available to you? Could you wait two or three years, while saving money to get your downpayment cash higher and thus have a chance to buy a higher-priced property?

I don’t understand “find a private home owner.” From whom were you thinking of buying a house, other than a current owner, who is a private party?

If feasible for you, you might buy a house larger than you need for your own use and rent out a room or two to other people to generate cash to help pay the high-priced loan payments. You might also consider buying a rundown house cheap and then fixing it up over time so that it is worth more than you paid for it.

After a couple of years of good loan payments, you should be able to qualify for a less expensive loan. If you have increased the value of the property sufficiently, you might be able to sell it and use the profits from it to buy, hopefully with a less expense loan, a more expensive home. Fix it up, sell in a few years, move on up to something more costly.

You might want to look for a bargain purchase – get for $35K a house which is actually worth at least $45K. This can be difficult in some markets. I do not know the St Louis market, but suspect that it might not be too hard to do there, especially in an older neighborhood.

How to find a bargain? Read the posts here on CREONLINE.COM . Consider getting the book “How to Buy Real Estate for at Least 20% Below Market Value” which is in “Books in Print.”

Owning your own home is probably feasible for you if you have a steady income and have beening paying market rents for several years. However, you might not be able to afford at this time a home in as good a neighborhood or in as good condition as you would like. But, don’t lower your expectations until you get out and check to see what is available to you. Expect to spend about 4 to 8 months getting familiar with the prices in and the quality of different neighborhoodss. Look at at least 100 houses which are available for sale to learn market values. More, if you need it to feel confident you can peg the values right on the money. Then start making your offers.

Good Buying Your Own HomeRon Starr*

Are their any options HELP - Posted by Ron St.louis

Posted by Ron St.louis on July 13, 2001 at 02:31:29:

Sorry for making it so short. The gov will provide up to 5250 to use as downpayment ,closing, or combination.
That’s correct 75000 is 80% , so I need 20% ( 5250 + ?$ + closing$ ). It does not matter price, that is my total allotment. I cannot wait even a few months. They may come in tommorrow and say 90 days ( august 1 ). I quess I need to find a private owner that will take the 5250 with owner financing for a few years to get on my feet. I don’t believe I could find anything for 35000( smile - wife). I shall take yours and every ones advice. thanks.

Re: Are their any options HELP - Posted by Ronald * Starr

Posted by Ronald * Starr on July 13, 2001 at 20:56:47:

Ron St Louis-----------

It is not clear to me that you can get the maximum of the government grant. Is the amount you get dependent upon how much you put up, the price, something like that?

I guess what you are proposing is to skip the 80% loans for which you are approved and try to get owner financing for the bulk of the sales price. This might work. Also, you might take on a house subject to the existing loan. You do not formally assume the loan, but you agree to take on the burden of paying them every month. This could get you a very good loan. You might have to try to hide from the lender that you have taken over that loan. There are many posts on CREONLINE.COM about doing "subject to"s deals.

Good House Buygin******Ron Starr************