Non-conventional loans are the most common types of financing for buyers of Rochester homes. However, not everyone is qualified to take out a mortgage. And if you also can’t qualify for a conventional loan, you are in for a major financing headache. Fortunately, there are other means of getting financing for the property you want to purchase, and here are few examples.
VA Loans
FHA loans or conventional loans are sponsored by the government. But if you can’t qualify for such a loan, you can still buy one of the available Rochester homes with another government-sponsored financing program, the VA loan.
These loans are guaranteed by the Veteran’s Administration. However, VA loans, as the name suggests, are only available for veteran who has served either 180 days of active duty since September 16, 1940 or 90 days of war service.
Balloon
If you still can’t qualify for a VA loan, balloon mortgages may offer an alternative to help you purchase Rochester homes. This type of loan keeps initial payments low for a certain period by financing the loan long-term. After the initial period, however, the full balance is due in one lump sum. This means that you should only choose this type of financing if—and only if—you can pay the remaining balance in full after your initial loan period.
Assumption
There are certain mortgages that are assumable. This means that the buyer can assume the responsibilities of the mortgage. This poses an excellent benefit for you if you still can’t find the right financing you need to complete the purchase and the seller just happens to have an assumable mortgage.
Assumable mortgages can save you money in terms of loan-application fees and other costs. The agreement is also between you and the seller. In addition, you have to pay the difference between the mortgage balance and the selling price. For instance, if the house is sold for $50,000 and you would assume a $20,000 mortgage, you need to pay the seller a total of $30,000. Of course, it isn’t simple math because certain things should still be considered.
Buy-downs
Another financing alternative to help you Rochester homes is the buy-down. This type of financing happens when the seller pays a certain fee to help you receive a financing at a lower interest rate. However, this type of financing is only often found with developers and builders.
Mark Michael Ferrer
Rochester Homes
