Your whole key when you have poor, or no, credit is to acquire ownership of at least one property and build from there. An excellent way for you to get your first property without your credit (or lack of it) getting in the way is to:
1. Take over a property having an Assumable Mortgage in which you start making payments one month after you acquire the property.
2. Gain ownership with NO credit check, NO review of your credit history, NO questions about your FICO score.
3. Look for Veterans Administration and FHA mortgages that are assumable. With such properties you can get started owning income real estate sooner than you might imagine.
4. Search for insurance-company-issued mortgages. Some such mortgages allow assumption without paperwork or other processing of any kind. Keep in mind that when you assume a mortgage you also become responsible for paying all of the seller's other obligations related to the property, including real estate taxes, mortgage payments, trash collection, fuel costs, maintenance of the building, and so on. Hence, you MUST have a PCF from the property.
5. Have your attorney (and you MUST have one) advise you as to the best way to assume ownership of the property.
When you take title "subject to an existing mortgage you become personally responsible for the mortgage payments. But when your attorney has you take the property "subject to the mortgage you are not personally responsible for making the mortgage payments. You must, however, make these payments if you wish to eventually own the property. As you know, I'm just a real estate investor and business advisor, not an attorney.Hence, you MUST have these cautions reviewed by your attorney and you should follow that person's advice not mine!
As you can see, assuming a mortgage can be a great benefit to you. But you must have competent legal guidance so your transaction is trouble free. Having a competent real estate attorney's advice will ensure a smooth and trouble free assumption of property by you.
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