Understanding Financing Options

Understanding Financing Options

For many, purchasing property is a new experience with an unfamiliar process. You may find yourself  with questions over securing financing for your new home purchase. In these cases it’s helpful for a Tony Clark REALTOR® guidance to break down the financing options.

Credit Scores
Explain the basics of credit scores and how they influence lender options. The better the purchaser’s credit score the more likely they can secure financing from a lender. Credit history, payment history, and how much they owe are all taken into account.

Applying for a Mortgage
If they haven’t done so, your Tony Clark Realtor(r) can direct you to a mortgage lender to get pre-approved for a mortgage loan.

Additional Financing Methods
If you  need other avenues of financing you may suggest they explore local, state, and national down payment assistance programs. Qualified applicants to these programs are given loans or grants for down payments.

Seller financing is another potential option. In some cases, the seller may be willing to finance the purchase price and let the buyer repay them gradually, similar to a mortgage.

It’s possible that the seller would consider a lease with the option to buy. In this case, your buyer would rent the home, affording them time to save more toward a down payment.

Another option is a shared-appreciation or shared-equity arrangement where family, friends, or a third party may buy a portion of the home and share in any appreciation when the home is sold. Mortgage, property taxes, and maintenance costs, are still paid by the purchaser, but all the investors’ names are usually on the mortgage.