Owning your own business is usually part of the American dream.
Unfortunately, the way things are set up with finding a home and running a business usually is set up for entrepreneurs to fail.
If you’re tired of being told that you need a big down payment and a spotless credit score to buy a home or you are an entrepreneur with a lot of drive and not a lot of liquid capital, there are alternative ways for buying a home that doesn't involve going through the traditional mortgage process.
Creative financing beats getting a traditional mortgage
I’m a business owner. And I own a home.
I did that by buying my home through a process called subject to.
This essentially means that I bought a property by using the mortgage that the seller already had. This is not the same as assuming a mortgage.
In subject to, you take over the payments on a home that is already financed, without actually assuming the mortgage yourself.
This is a good option if the seller is motivated to get rid of the property and is willing to let you take over the payments. The mortgage stays in their name until the property is paid off, the home goes in your name and you make the mortgage payments.
How is subject to differences from owner financing?
Owner financing is when the owner of a house acts as your bank, so they get to set their own terms.
When the property acts as the lender, and you make payments directly to them rather than a bank, they get to make all the money that would have gone to the bank in interest.
They can also negotiate prices up for the seller, if it means that you get a lower interest rate.
Owner financing is awesome for entrepreneurs because you can save so much money won interest without running your own credit, handing over your own cash and you don’t have to have the credentials of a W2.
One skepticism I hear from small business owners is that owner financing or purchasing a property subject to is illegal. That’s actually a common misconception people make, which is why there are so few options on the market that are openly owner financed or willing to do subject to.
The problem is misinformation.
Not only are creative financing methods a viable way to attain a home, but it works on any kind of property when you find the right seller: cars, RVs, trailer, bikes, computers, you name it.
In the SubTo community, we’re trying to help people understand that there are so many more options on the market that can help people be able to afford homes. The way to get a house is not just through the bank, despite what they’ll have you believe. And you can be a part of it.
Stop believing the untruth and start doing something that will benefit you and your family – not the banks.
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