Did you know that the average American can buy a house with less than $10,000?
Many have continued to sit on the sidelines paying rents that continue to rise, while others have been buying up dozens of properties at relatively cheap prices. Most of these properties end up back on the market at much higher prices, or a pricier rentals. Those that haven’t bought typically believe they can’t for one reason or another. More often than not, they feel they don’t have enough money. But what if I told you that isn’t the case at all. Having said that, what options do people have with limited funds and low credit scores?
Buying Homes for $10,000 or Less
Even though real estate is setting records in many parts of the country, there are actually still some very inexpensive homes around the country. There are a variety of more creative ways to scoop great deals on more expensive homes too.
Real estate auctions are a common place to find potential house deals for less. There are different types of auctions to check out too. This includes foreclosure auctions and estate sales. Others have found buying tax liens is a viable way to acquire real estate for less. When property owners don’t pay their taxes, the liens are auctioned off to public bidders. If owners still don’t pay their property taxes, homes and commercial real estate can be foreclosed on. Buying small mortgage non-performing notes can be another acquisition vehicle. If borrowers continue not to pay their debts, then the note holder can foreclosure and take possession of the property. However, it is important to note that you often get what you pay for. Many of these properties may require repairs or updating. Some may even need replacing. Make sure you do the math on your next transaction.
Buying Homes with $10,000 or Less
Even though the average U.S. home price recently hit $230,000; the average buyer should still technically be able to purchase a home with less than $10,000 out of pocket. With just a 660 credit score, and often far less homebuyers can qualify for a range of low and no down payment home loan options. That includes FHA, VA, USDA, and HomeReady mortgage loans. By having the seller contribute a credit to cover closing costs, all the buyer really needs to come up with is a minimal down payment, if that. Even at 3.5% down on a $230,000 home, that is still less than $10,000. The resulting mortgage loan of $221,950 at 4% interest, on a 30-year loan leaves a monthly principal and interest payment of just over $1,000. That’s less than most are paying in rent!
Then there are seller financing, hard money, and peer to peer loans for those with scenarios that may not qualify at a regular bank or mortgage company. There are also potential lease option deals for those not quite ready to get a loan or buy, but who doesn’t want to miss out on today’s great deals.
It’s Not Getting Cheaper to Buy a Home
It’s not likely to get cheaper to buy a home anytime soon. In fact, quite the opposite is happening. Between rising mortgage rates, rents heading up and squeezing income, it’s getting a lot more expensive to buy a home in the U.S., and fast.