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Unique Ways To Finance Your Home And Save Money


Written by
Wednesday, July 08, 2020

Buying a new home can be a very exciting process, especially if it is your first home. Now that you are turning your dream of owning a home into a reality, it's time to figure out how you will pay for it. Most people will choose to take out a home mortgage with a traditional lender like a bank or credit union. If you are worried you may not be qualified for a loan with a great interest rate, you may choose to take other options for financing your home into consideration.

With some due diligence and research, you may find you have other ways of helping pay for your home that you would have never thought of before. There are companies who offer customers flexible financing options that will work for your budget. Below are some alternative ways to finance your home and save money on utilities.

Ask Family For Help

If you are not wanting to ask a bank for a loan, maybe you have family who could help you out instead. Many first-time home buyers choose to ask their parents for a loan when purchasing their first home. If your parents are financially in a position to offer you money, it should be considered. Be sure to have all of the agreed-upon terms written down and signed.

Seller Financing

In some cases, it may make more sense to find a home where the seller is offering to finance the buyer. This typically happens when the seller is having trouble getting their home sold. While this is not typically the best deal for sellers, it can offer a lot of benefits to a buyer. You may find yourself able to close much faster than with a mortgage from a traditional bank. Typically, the downside to this type of deal is having to pay higher interest rates. This will allow the seller to make up for the risk of financing the mortgage themselves.

Rent-To-Own

Another popular option for financing a new home is a rent-to-own program. These programs are very straightforward and allow prospective home buyers to rent a home they're interested in for a specified amount of time. Once your time is up, you will be able to choose whether or not you want to buy the home. The downside to this type of program is that the payment is often higher than typical home prices in the area.

If you choose not to buy the home, the money you paid will not be given back. However, if you choose to buy the home after the rental time is over, the money you spent on rent will be applied toward the final purchase price of the home. This deal works best for someone looking to buy a home within the next few years and they are unable to come up with a down payment at the time. It is also perfect for people who are working on raising their credit score to get approved for a low-interest mortgage.

FHA Financing

An FHA loan is insured through the Federal Housing Administration. This allows lenders the ability to offer home buyers better deals with low down payments, easy credit qualifications and lower closing costs. If you're looking to buy a home when are low on cash and have a bad credit score, an FHA loan is a good option to consider, especially if you are a first-time home buyer. If you consider this type of loan, you will be limited to purchasing properties that are FHA approved and will be required to purchase mortgage insurance.

Solar Loans

Once you purchase your home and find a way to finance it, you should always be on the lookout for ways to save money and afford your rent. A solar loan is a great option to consider if you are interested in solar energy. These types of loans can be secured against your home. Once the solar panels are installed, the money you save on your electricity can be used towards your mortgage payment.



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