How to Buy a House without a Realtor Friday, Aug 13 2010
Loans + Cash Info and Real Estate Profits and Tips + Tricks 4:05 pm
Knowing how to buy a house without a Realtor can give you more options, since you will not be limited to purchasing a home that is listed. In just about any community, you can find houses with “For Sale by Owner” signs out front. Most of these sellers have not listed with a Realtor because they know that there isn’t enough equity in their homes to pay the Realtor’s commission. However, there are other reasons for not going through a Realtor as well, and some people just like to do things themselves.
Whatever the reason for not involving a Realtor, the hardest part about buying a for sale by owner home is obtaining financing. If you have enough money in the bank to pay cash for a house, you won’t have to worry about this, but most people don’t. When you purchase a home the traditional way, the Realtor will usually put you in touch with the mortgage broker or lending institution he works with most often to help you get approved for a mortgage. If you are buying a house without a Realtor, you’ll have to find a mortgage broker yourself.
It is important to make sure you are dealing with a mortgage broker, not a mortgage lender. What is the difference? A mortgage lender is a bank or mortgage company that loans money to purchase homes. When you apply for a mortgage through a mortgage lender, they will consider only for the loans they offer through their own company. A mortgage broker, on the other hand, works with hundreds of lenders and can help you find a lender that offers the type of loan you need.
In addition, many mortgage brokers will help you get qualified for a mortgage if you need to work on your credit or some other area in order to qualify. No, they don’t fix your credit for you, but they will tell you what you need to do to improve your chances of qualifying. For example, they might tell you that you need to pay off a certain amount of credit card debt or increase your income by $100 per month. A mortgage broker can look at your credit report and point out the trouble areas so that you know what it will take to qualify for a mortgage.
Once you have the financing in place and have found a house you want to buy, you can negotiate directly with the seller to determine the price and other terms. You can find real estate forms online or at an office supply store to write up the agreement. Then, depending on where you live, you will need to contact either a title company or a lawyer to set up a closing.
At HowToBuyAHouse.org, you can find a more detailed article on the same subject: How to Buy a House without a Realtor.
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