| Creative financing allows people, who might not | | | | finance your home with two mortgages from different |
| otherwise qualify for a mortgage, buy a home. It can | | | | lenders. One covers 80% of the home price, the other |
| also be used to secure lower payments, which can | | | | for 20%. This spreads the risk between financial |
| save you money if you plan to sell or refinance soon. | | | | companies and allows you to avoid paying for private |
| With creative home loans, it still is important that you | | | | mortgage insurance. |
| shop lenders to get the best deal. | | | | Or maybe you want to purchase a home that is |
| What Is Creative Financing? | | | | above the conventional mortgage cap - in 2006 the |
| Creative financing is any non-conventional loan term | | | | limit was $417,000 for a single-family home. Then you |
| used to finance a house. Conventional loans are sold | | | | could apply for a jumbo loan with fixed or adjustable |
| to such companies as Freddie Mac and Fannie Mae. | | | | rates. |
| They will only buy loans if the borrower qualified with | | | | Be A Smart Shopper |
| prime credit, the loan is under a certain amount, and | | | | The majority of mortgage lenders will provide creative |
| there was a down payment. Non-conventional loans, | | | | financing of some sort. In fact, there are even |
| which account for 25% of mortgages in 2006, can | | | | government backed loan programs, such as FHA or |
| have creative financing terms, such as a balloon | | | | VA loans, that are considered non-conventional. Once |
| payment or interest-only payments for a short period. | | | | you decided on the loan terms you need, shop loan |
| You can also finance a home over this amount with a | | | | offers. Request loan estimates from mortgage lenders |
| jumbo loan. And those with poor credit can also | | | | and brokers. Then compare their rates, fees, and |
| receive a sub prime loan. | | | | closing costs. And make sure you understand all their |
| Ways To Use Creative Financing | | | | penalty clauses. |
| Creative financing is used to solve problems. For | | | | In a short amount of time you can find a loan with both |
| instance, if you don't have a down payment, you could | | | | favorable rates and terms for your financing needs. |