Many People ask if you can buy a house for no money down, we wanted to clear up the myth about a “no money down” house purchase.
Buy a house for no money down? The answer is no.
Buy a house for very little money down? Yes!
Let me explain. When a seller wants to sell their house for no money down they are in dire straits. They just want to boogie. Most people in this position are facing foreclosure, divorce, loss of a job, job relocation or a host of other reasons.
There are several common vehicles to quickly buy a house under duress.
1. Through a lease option.
2. Buy the house subject to the existing financing.
3. You may also buy the house all cash. The price has to be acceptable to both parties.
4. Buy the house with a mixture of cash and existing financing.
5. A conventional bank loan.
6. Finance using a loan through a private investor.
7. Owner carry loan.
In most cases a minor amount of money changes hands. Typically up to $5000 depending on the situation, and the equity in the property.
In extreme cases, some people are so desperate, that they will sell the house for moving money $500 – 1000.
In super extreme cases homeowners will walk away for $10 consideration to make the contract legal. This is usually the case when the seller is upside down in the property, with no equity.
In these cases the investor is providing a fast exit to “save their bacon.” It usually boils down to keeping their credit and starting over in life with a new beginning. It is not very common but it does happen from time to time.
This article is meant to be more informative from an investor’s standpoint. As I stated earlier, there really are no money down deals. It is a small amount of money down to buy a house.
“No money down“, is great copy, but in my opinion is not in line with the “real world”!!