The recent recession caused a number of Americans to rethink whether buying homes for sale in Menifee, CA and elsewhere is really a good thing. And yet, there are still plenty who prefer owning a home than renting one—a 2013 survey commissioned by the MacArthur Foundation revealed that more than 7 in 10 renters look to own a home someday. With wage rates staying stagnant, opting for a standard mortgage still isn’t for everyone, however.
Fortunately, there are a few alternative ways for people to finance a home acquisition, aside from a conventional mortgage. Read on for more information on them.
Check on Local, State, or National Down Payment Assistance Programs
Such programs are designed to give qualified applicants loans or grants to cover either all or part of their down payment for a home. National programs include the Nehemiah Program and the American Dream Down Payment Fund offered by the Department of Housing and Urban Development. Be sure to inquire about similar programs in your state or city as well.
Take Advantage of Seller Financing
Seller financing arrangements allow you to make mortgage payments directly to the actual seller of the house. An official agreement defines the finer points of the sale: principal amount, interest rate, repayment schedule, consequences or default, as well as other related terms drawn up in a promissory note. This is, of course, a viable option if the seller is willing to finance all or part of the home’s asking price on your behalf in the first place, so be sure to ask first.
Try a Rent-To-Own
A rent-to-own agreement grants the renter the right to rent a property out, with the option to purchase the property itself at the end of the term. In this agreement, the monthly payments will typically be more expensive than the current market rate, and the surplus amount will be used for down payment on the house. This is a good option if you may not be ready to purchase a property outright, but fairly certain that you’ll be able to in the future.
Consider a Shared-Appreciation/Equity Agreement
Your family, friends, or a third-party entity may buy a portion of the home and share in any appreciation when the home gets sold with this agreement in place. The owner/occupant typically covers the mortgage, property taxes, and maintenance expenses, but all investors’ names are often on the mortgage itself. If for some reason your family can’t participate, several companies can help you find an alternate investor.
Finding financing to buy Menifee homes for sale from companies like Team Robinson can be tough, but the aforementioned alternatives can help. You just have to look for such opportunities.
Creative Ways Americans Can Buy A Home, US News & World Report, February 3, 2015
6 Creative Ways To Afford A Home, RealtorMag.Realtor.org
4 Alternatives To A Traditional Mortgage, Investopedia, May 4, 2010
4 Alternative Ways To Finance A Real Estate Investment, LandLordStation.com