Expert: Jim Root - 2/3/2010

Question
I started buy the house I rent FSBO. The owner wants me to find a lender that will loan me the money to pay off the house with her. I have gone to my credit union who said to try a home equity line of credit since the owner only wanted 28k less than 40k. I have the paper that was signed through a title company and they are telling me there is nothing that can be done. Am I able to refinance or what is my next step and what questions do I need to ask to get the credit union to understand what I am trying to do?

Answer

THELMA--

I have 3 College Degrees:Real Estate(AA),Mass Communications(BA) and Education(MA.T)--an IQ of 144,--3 Professional Designtions(CRO,RMU,CRA--all in the Real Estate area)--5 years as a Real Estate Broker--5 years as a Residential Appraiser--5 years as the Manager of a large Mortgage
Banking Compny--and 15 years as a Government Housing Official (REALTY OFFICER) with HUD's FHA Division.

With all of that behind me, you'd think I'd understand your question, wouldn't you? I DON'T That's because FSBO's and Real Estate Pros speak different languages. And that's why approx. 85% of FSBO "starts" never "reach the finish line! THEY FALL APART AFTER BOTH THE WANNABE BUYER & COULDABIN SELLER HAVE SPENT NON-RECOVERABLE  M-O-N--E-Y ON TRYING TO PUT THE DEAL TOGETHER!


If you want to buy your Landlords house, find a licensed REALTOR to handle the transaction  for both of you!You three can agree upon a price and terms and the Realtor will put together a SALES CONTRACT that is agreeble to both you(the Buyer) and the Landlord (the Seller).You and your Landlord can SPLIT the cost of the Realtor's Commission.The Realtor will know what other Costs/Fees  will be involved and WHICH of you PAYS which!Have the Realtor take you to a Lender who understands what your trying to do.YOU DON'T NEED A HOME EQUITY LOAN OR LINE OF CREDIT; YOU NEED A "PURCHASE MONEY MORTGAGE"--TO B-U-Y THE HOUSE.

If you have secure employment, a decent wage,a minimal in monthly payments (other than  water,  garbge, electricity, insurance, gas and other "basic neccesities,and A REASONBLE CREDIT SCORE YOU SHOULD BE ABLE TO GET AN FHA-INSURED LOAN TO PURCHASE THE HOME PROVIDED THE PRICE/VALUE DOESN'T EXCEED YOUR LOAN CAPABILITY.

I hope you don't misunderstand my answer--I'm not being rude, just telling it like it is!RUN,FIZZ-BO,RUN,

--JIM

PS: By-the way of the approx. 15% of the FSBO's that make it to "the closing table." end up with the Buyer paying several $K more than the house is actually worth.These are deals were the Buyer pays cash for the house--there's no Appraisl,no Title work,no Lender. The Seller "Carries the Papers"

PLEASE--FIND A REALTOR AND Let him/her help you into your first HOME!

G-O-O-D  L-U-C-K-!


--JIM