Ways to Finance a Home Purchase

One of the more obscure fields on MLS lists the various kinds of financing the Seller will accept, or may be available to buy the home.

home loanSo, it’s typical to see “Conventional” (federally guaranteed mortgages under $417k), “FHA,” “DVA” (Department of Veteran Affairs), and “Jumbo” (loans over $417k) — plus every Seller’s favorite, good ‘ol cash.

Occasionally, I’ll also see “203(k)”, which are federal loans available for homes needing substantial rehab.

Last Resort(s)

That’s fine for homes that are truly a mess.

However, when I see “203(k)” listed in the financing field, my knee jerk assumption — and I’m sure many other Realtors’ — is that the home is a mess.

As a result, when I’m screening LOTS of homes online with clients not interested in tackling multiple “projects,” that can be a reason to skip the home and move on to others.

As they say, “the first showing is online.”

P.S.: ┬áMy OTHER association with 203(k) loans — fair or not — is that they’re cumbersome and involve lots of red tape.

Which is yet another reason why, as a listing agent representing the Seller, I’d hesitate to offer that as a form of financing.

About the author

Ross Kaplan has 19+ years experience selling real estate all over the Twin Cities. He is also a 12-time consecutive "Super Real Estate Agent," as determined by Mpls. - St. Paul Magazine and Twin Cities Business Magazine. Prior to becoming a Realtor, Ross was an attorney (corporate law), CPA, and entrepreneur. He holds an economics degree from Stanford.

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