Some people do not earn enough money to buy a home, and this
is most difficult item to correct. But it is changeable. A person can get a
better job or seek raises by being a stronger employee; they can get a 2nd
job or even start a supplemental home business. There are ways to maneuver for
people with too little income. If they are on the border of income or just
below it, a lease option may be what they need. That is leasing a home with an
option to purchase it at a contractually specified time. If they are not ready
at that time, it can be extended if both parties agree, or, they simply lose
their option fee which is not that large, and, they are not obligated to
proceed.
The next big block is income verification. But this is solve-able too. The loan people
look for 2 years of employment to verify. If self-employed, then 2 years of IRS
1040 forms are used. If a person cannot produce the 1040’s, for whatever the
reason may be, they may be able to be qualified based on their bank statement
history over 24 months. As you can see, there are ways to work the issues, if
you the buyer has the desire and the will to get into a home. Home ownership in
America is based on desire, plain and simple. An easier road is to go rent an apartment
or house and just not think about obstacles. But home ownership procrastinated
or delayed can lead to other problems, such as rent increases or landlords
selling homes out from under renters.
The last thing I want to mention is credit, credit scores
and credit unworthiness. This may be the easiest block in buying a home to
solve. Many credit issues can be changed in just a handful of months. Many
people rely on Credit Karma to keep up on their scores. But Credit Karma
lowballs your scores in hope that you will take out a higher interest credit
card like Capital One. It’s a money maker for them and highly deceptive. Those
are not FICO Scores they are quoting you, and FICO is the only scoring system
that home lenders use.
Currently, my own
Credit Karma score runs about 50 points lower than my FICO score. Imagine if that particular deception blocked
you from buying a home in the past while housing prices continued to climb up
higher and higher. A good house lender will run your credit for FICO scores and
give you a true reading. Forget fearing inquiries on your credit, if you don’t
do it often it is not that damaging. At times, one person may be score qualified
and their spouse is not due to credit issues. Focusing on that other spouse’s
credit scores is the answer especially if they have an income that qualifies
the couple for more home and a higher price.
I realize timing is everything in home buying, and people
may be holding off due to high prices of homes. But there may be a location or
neighborhood that is still affordable for you and beginning to think about it
and educate one’s self is the way to establish thought processes that can later
bring the desired home ownership to pass. I will continue to share practical helps
and ideas in upcoming blog issues. Knowledge is very powerful for consumers. If
you’d like to discuss anything further with me about home buying or getting
access to a competent and honest home lender, call me. 916-580-7235, Greg Nichols, MFN Realty.
MFN Realty
916-580-7235
DRE # 00632894
mfnnetwork@gmail.com
A Licensed California Real Estate Broker
