I am looking for loan and grant sources to help low income renters buy
and live in inexpensive single family homes in Rochester NY.
In New York State, mortgage loan closing costs cannot exceed 5% of the
loan amount, but mortgage closing costs like appraisal, bank attorney,
title insurance, and mortgage tax (and many others) greatly exceed
this 5% limit for loans under $25,000, so I have not been able to find
a mortgage lender who can make these loans.
I am looking for lenders who will make these small loans as simple
unsecured personal loans, or as even as a personal loan with a lien
against the house, but without the full blown mortgage processing, as
these loans are smaller than many car loans today.
Even though the interest rate for the new homeowner may be higher with
a personal loan than with a mortgage, the overall costs are less and
he or she can own their home free and clear after repayment of a 5-10
year long personal loan, rather than a 15 or 30 year mortgage.
In addition, the cost of principle, interest, taxes and insurance in
this $25,000 and less price range using a personal loan is about the
same as rent in the same kind of neighborhood.
Do houses that cheap exist? Where I live $25,000 would buy a phone booth.
Real estate transactions are pretty heavily regulated regardless of
price, so certain hoops have to be jumped thru. I don't know how the
laws of New York work but in California if you get a loan you will
have to pay the types of costs you mentioned (although we use escrow
instead of a bunch of attorneys). With larger loans you can wrap up
some or all of these expenses in the interest rate, but with smaller
loans that's just not possible. The interest rate required to do it
would just be too great.
 I could use some help again...
 Lost Licences |
Finding loans / grants for people buying homes priced below $25,000