The Easiest Way to Buy a House

by - 8/31/2021 01:27:00 AM


The easiest way to buy a house would be to pay for it in cash, which as some of the latest figures show, make up about 36 percent of the market. If you already own a home that's increased significantly in value and plan to move to an area where homes are much less expensive, you've received a windfall, or have the money available for any other reason, that might be possible, but for most you'll need to secure a home loan and finance the purchase.

If you don't have much cash and are trying to come up with the answer to  the question, "Should I rent or buy a house?" when you need to move quickly, you may have to rent. That's one of the main reasons most buyers can't purchase a home: money. And, the process of buying, including obtaining a home loan, is going to take longer no matter how you look at it. Purchasing a home isn't cheap, but the better news is that you might be able to get the keys to your very own home without having to come up with a lot of cash. In fact it can be done with very little money with multiple types of loans, grants, and incentives available.

If you have an excellent credit score of 740 or higher but little money available, it's going to be even easier. These options can make your dream of becoming a homeowner possible without taking months or even years to save up.

VA Home Loan

The Veterans Administration (VA) sets the rules for home loans to veterans. While the VA doesn't issue loans, it gives authority to mortgage lenders, credit unions, and banks to offer them. If you're a veteran who meets the qualifications, the amount you can be loaned may be as much as the full appraised value of the home. And, the seller might pay as much as 6 percent of the home price in closing costs. If your credit isn't stellar, the VA is a good option as its credit guidelines aren't as strict. The guidelines for a VA loan simply require that the veteran earns enough money to make the monthly payments, expected living expenses, and any current debt.

FHA Mortgage

FHA Mortgages have long-been popular for obtaining home loans among those who don't have the cash, or have very little, for the down payment. The Federal Housing Authority (FHA) works like the VA when it comes to mortgage, in that it doesn't issue loans but grants permission to banks and other lenders according to particular guidelines. The downside is that a 3.5 percent down payment of the home's sale price is required, but the money doesn't have to come from the borrower like others require. It can be gifted from parents or other relatives. FHA mortgages also have more lenient credit standards and allow the seller to pay closing costs.

Conventional Mortgages

Originally, when banks began offering mortgage loans, they required 20 percent of the home's price as the down payment. That's a very large chunk of money with today's home prices, but thankfully, that requirement has been lowered to just 5 percent. While they can still be a significant amount of money, for a $250,000 property, that means $12,500 instead of $50,000, which is a lot easier for most to come up with.








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