Читать книгу Rent-to-Own: How to Find Rent-to-Own Homes NOW While Rebuilding Your Credit - Wendy Patton - Страница 8

With the severe tightening of the mortgage lending industry, buyers are having a harder time getting mortgages. The subprime mess we’ve all heard about means that many buyers who could qualify for mortgages before are no longer able to. This may be your situation.

During the “Boom Years,” lenders were putting buyers into Adjustable Rate Mortgages, or A.R.M.’s, meaning their interest rate would be adjusting after the introductory period, thereby increasing (possibly decreasing, but not likely) their payment. They did this because the buyer couldn’t qualify for a standard mortgage or even if he could qualify, he couldn’t afford the payment because the interest rate on the 30-year fixed mortgage was so much higher. These adjustable rate mortgages are one type of a subprime loan.

The lenders reasoned that it was okay to give buyers these loans because home prices were appreciating so rapidly. The thought was that by the time the new homeowner’s mortgage was getting close to adjusting upwards, the home would have appreciated enough that the owner could refinance into a conventional fixed rate mortgage.

Unfortunately, the rapid appreciation didn’t continue forever and the homeowners discovered that not only could they not refinance their loan into a fixed rate, but they also could not afford the payments when their current loan adjusted upwards. The resulting impact is the highest number of home foreclosures in our nation’s history!

With so many loans going into foreclosure, a number of smaller lenders went bankrupt and some of the larger lenders have stopped writing mortgages altogether. The lenders that continue to provide loans are being much more conservative, instituting much stricter guidelines, resulting in a serious “Credit Crunch”.

This “Credit Crunch” directly impacts you as a potential homebuyer. Unless you have A+ credit or a very large down payment, getting a mortgage may prove difficult. If you haven’t already spoken with a mortgage broker, you should do so to find out if you can currently qualify for a mortgage. If you have already spoken with a mortgage broker and you know you can’t qualify yet, you know about this “Credit Crunch”.

Many would-be buyers despair after talking to a real estate agent and a mortgage broker who tell them that they can’t help them because they can’t qualify right now. This is why you, as a buyer, would need to do something like rent-to-own. It gives you the opportunity to get into your future home now, before you can qualify for a mortgage.

Yes, you do have several choices when it comes to buying your new home! Obviously, this is the part where I sing the praises of rent-to-own.