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  • Writer's pictureRebecca Richardson - Mortgage Consultant

Exploring Home Buying Options and the Impact of Credit and Down Payments

Hey there, prospective home buyers! Let's dive into the world of home buying and discuss various options available to you. We'll also delve into the influence of your credit and the money you've set aside for a down payment on these choices.

Holding onto Your Current Home as a Rental

Imagine you already own a home, and you're looking to buy another while keeping your current one as a rental property. It might sound a bit complicated, but don't worry; there are practical solutions. The challenge here is understanding how to qualify for two mortgages and finding the necessary down payment without selling your current property. Here are two smart strategies:

  • Strategy 1: Some loan types allow you to consider potential rental income from your current home when applying for a new mortgage. It's like finding a missing puzzle piece!

  • Strategy 2: You can explore a Home Equity Line of Credit (HELOC) on your existing property. Think of it as a special tool that helps you bridge the gap, providing the down payment for your new home.

Remember, seeking guidance from a mortgage professional is essential. With their expert advice, you can turn your real estate dreams into reality!

Multifamily Homes – A Practical Choice

Have you heard about multifamily homes? They're a fantastic choice because they make homeownership more affordable. The unique aspect is that you can live in one part of the home and rent out the other parts. It's like sharing the puzzle-solving task with someone else, making it easier to complete. This not only helps you cover the costs of your home but also opens doors to real estate investment. What's even better is that when you buy a multifamily home to live in, you can often make a standard down payment, just like with a single-family home. Additionally, you can use the rent from the other units to help secure your mortgage. It's like a double win-win!

Understanding Your Credit and Down Payment

Let's shift our focus to your credit score and your savings set aside for a down payment. It's somewhat similar to navigating a map to find the right home loan. Your credit score plays a crucial role in determining the kind of loan you can secure. Having some savings for a down payment is like having a useful tool to assist you on your journey. But even if you haven't saved up enough yet, there are strategies to make it work.

In a nutshell, there are diverse paths to homeownership, and your credit and savings can guide you to the right one. Whether you're retaining your old home, exploring multifamily properties, or weighing your loan options, with the right team by your side, your homebuying journey will be a success!

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