| 1. Lease-Option | | | | acceptable credit and verifiable income. Several |
| Rent a property from the seller with the option | | | | zero down mortgage loans are available, especially |
| to buy. This buying technique is ideal for home | | | | to first time home buyers. These include select |
| buyers with bad credit and no money down. With | | | | FHA and VA loans. Home buyers with no money |
| a lease-option agreement, the seller establishes a | | | | down loans typically pay a higher rate and PMI |
| monthly payment for the property, and the | | | | (private mortgage insurance). |
| renter agrees to purchase the property within a | | | | 4. Seller Financing |
| reasonable period. Since a percentage of the | | | | If you canít afford the 20% down |
| monthly rent payments are credited toward the | | | | payment, ask the seller to increase the asking |
| purchase price, the renter/buyer receives down | | | | price, and seller finance a portion of the property. |
| payment assistance from the seller. | | | | For example, increase the original sale price of |
| 2. Mortgage Assumption | | | | $120,000 to $144, 000. The mortgage lender will |
| Buyers may offer to assume responsibility of a | | | | agree to finance the lesser balance because |
| property and use the seller's current financing. | | | | itís 80% of the asking price. Next, the |
| Mortgage assumptions assist home buyers with | | | | home seller carries a note for the balance of |
| adequate means to meet the expense. In | | | | $24,000. After the closing, the seller may continue |
| exchange for making mortgage payments, the | | | | to hold the note, or sell the note. |
| buyer receives the property title. Before assuming | | | | 5. Borrow a Down Payment |
| a loan, research the original loan agreement and | | | | Funds for a down payment can be borrowed |
| look for a "due-on-sale clause." This provision | | | | from family, friends, or private investor. Discuss |
| prohibits a mortgage assumption. | | | | installment payments at fixed intervals, or repay |
| 3. No Money Down Loans | | | | money upon sale of the property. Other options |
| Zero down home loans or 100% financing is a | | | | include borrowing money from a life insurance |
| simple way to buy real estate with no money | | | | policy or 401K. |
| down. To qualify, borrowers must have | | | | |