Finding the ideal home and having your offer accepted is oftentimes only half the battle when it comes to securing the actual purchase of a house or condo. That’s because in many cases, a mortgage will be required to close the deal.
But what happens if your mortgage application is turned down?
Although this can be extremely disappointing, there are some potential solutions that could still allow you to still get the deal done.
One option may be to inquire with the seller about owner financing. In this case, the seller acts as the “bank” and they hold the mortgage while you make the payments to them. This option can still help you to build up equity in the home – and after some time has passed, you may be able to refinance with a traditional bank or lender.
If you are unable to qualify for a mortgage on your own, you could apply for a home loan with a co-signer. Here, you can essentially “borrow” the co-signer’s credit, which ideally will help to strengthen the overall application. Plus, you may also be able to increase the overall debt-to-income ratio.
You could also consider “renting to own.” In this scenario, you and the seller will agree on a purchase price, even though you will rent the home. In many cases, a portion of your rent payments may even go towards your future down payment. This can help to ease the burden of coming up with a substantial amount to put down when you actually purchase the property.
If you’re thinking about looking for a new home, there are many components that all need to fall into place. But, with the assistance of an experienced real estate agent, you can focus on the important details, and leave the rest to the professionals.
Give us a call today if you would like guidance on how to move forward with the purchase of a new home – and, if you plan to put your current residence on the market, we will provide you with a no obligation value analysis.