Ease of getting a dirt cheap home loan?

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Property management company let the home I rent go into foreclosure. Bank has possession of the home but have now listed it with a real estate agency. I visited the listing online today and was shocked to see that the home (since it was foreclosed on by the bank and they just want what is owed on it) is listed for just $ 19,900 (3 bed 1.5 bath, worth at least $ 45,000, maybe more). Payments for a mortgage will be half or less than what I am paying in rent, which is currently $ 650/mo. Last time I checked a few months ago, my credit score was about 570. Do you think that my bank will give me this low loan? Would I have better luck getting this loan elsewhere? The property is worth quite a bit more than it is selling for, so they can’t really lose. What would you recommend?

2 Comments
  1. Reply
    estielmo
    April 29, 2011 at 9:19 pm

    Expect processing fees and maybe back taxes to be added to that amount, but it seems to me you could get a 10 year loan (don’t get a balloon/variable) for about $ 500 per month (with tax/insurance) with the extra 150 banked to maintenance/repair.

    I’d jump on it.

  2. Reply
    Pengy
    April 29, 2011 at 9:54 pm

    With that credit score low to no chance, you would also need money down, closing costs, pre paid things like appraisal, inspection, insurance etc. Hard to get a mortgage for under 50K but hey you do not know until you ask, biggest thing right now holding you back is your credit score, and possible debt to income ratio.

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