Financing info to seller
Question: As a mortgage lender, I will tell you that most people use FHA financing only when they can’t get conventional financing. (Most, not all.) FHA loans are such a pain in the ass that I won’t even do them. So a seller puts up a big red flag when he hears that his buyer is going with a government loan.
Frankly, if you can’t come up with 3% plus closing costs (or if you have bad credit problems), perhaps this isn’t the right time for you to make the financial commitment to own a home.
Answer: I beg to differ. In October of ‘93, when interest rates were at a 25 year low, I was income rich (new job out of grad school), good credit, first- time homebuyer, and savings poor. It was the perfect time to buy, and if I could have used FHA (the houses around DC cost too much), I would have to solve my money shortage. I had to find alternatives sources of cash for a down payment and was able to get a 6.5% / 0.5 pt fixed loan. Won’t be down there again for a while, and I would have missed it but for cash. Not having cash sitting around is not a sufficient reason to diagnose someone as not ready “to make the financial commitment to own a home”
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Filed under: Bad Credit Loan
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