I am looking at taking a job in another state, and my sister in law has expressed interest in buying my house. This would work for me since a) There is a short selling season for homes in my area and we are nearing the end of it, b) homes aren’t selling very well in our area and c) not having to go through all the home selling difficulties.
However, she just took a new job that in the first year doesn’t pay much at first(commercial pilot) but in about 6 months she will be roughly doubling her income, making the payments much more affordable. I would like to be able to get the money out of the house in order to look at a new home, but can afford to wait a few months. She has a few thousand down for a down payment, but the issue for her is short term cash flow.
So, what I am interested in are some non-traditional financing options that may work for this situation. I called my home mortgage provider, and they said that they do allow assumptions (I have the house abotu 1/2 paid off), but I was wondering how we could recapture the balance of the prospective selling price.
Not dealt with rent to own type agreements before. My understanding is that the renter woudl pay basically rent for a year, but if decided to buy they can apply the rental payments to the cost of the house?
All the rage nowadays is the “interest only loan” or the “adjustable rate mortgage”.
With little money down, your SIL can just pay the interest on the house (a low payment), and by the time she has to come up with a full payment, presumably she’ll be employed. Some places even let you slide with “stated earnings” which is easier than actually demanding to see several paychecks.
In the past few years, they’ve been handing these out to anyone with a pulse. However, I’ve read that they’re tightening their qualifications a little, so if your SIL is on the bubble, credit-score wise, she could be shit out of luck.
To a lender, you’re basically saying, “give me $200,000 now. My SIL in law will pay you back, when her job gets better.”
If her current job isn’t going to pay the bills, don’t count on a lender being to understanding of a promise.