Financing less than a house is worth…is it any easier?

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My husband and I are planning on purchasing a house that is currently in my parent’s name. We have done many improvements and it is currently appraised at around $ 87,000 (before improvements) but the loan we will need to get will be the $ 65,000 my parents are asking us for it, plus we would like and additional $ 10,000 for a new roof and some other things we would like to do. My question is, is it any easier to get approved for a house when you are financing less than it is worth or does the bank look at it the same way? We’ve had some credit issues in the past, we got in over our heads with a house we purchased in 2002 (we sold it in December 2006) so in 2003 we had a vehicle reposessed, a few late mortgage payments in 2006, and there are some medical bills which could be taken care of with less than $ 2,000. My husband makes $ 66,000 yr and has been at his job ince 1998. Is this going to be just as difficult as any mortgage loan or easier? Thanks!

Subprime… Surprise!

"Les ménages français sont aujourd’hui les moins endettés d’Europe. Or, une économie qui ne s’endette pas suffisamment, c’est une économie qui ne croit pas en l’avenir, qui doute de ses atouts, qui a peur du lendemain. C’est pour cette raison que je souhaite développer le crédit hypothécaire pour les ménages et que l’État intervienne pour garantir l’accès au crédit des personnes malades. Je propose que ceux qui ont des rémunérations modestes puissent garantir leur emprunt par la valeur de leur logement. Il faut réformer le crédit hypothécaire. Si le recours à l’hypothèque était plus facile, les banques se focaliseraient moins sur la capacité personnelle de remboursement de l’emprunteur et plus sur la valeur du bien hypothéqué. Ceci profiterait alors directement à tous ceux dont les revenus fluctuent, comme les intérimaires et de nombreux indépendants."

Nicolas Sarkozy – Septembre 2006

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The French households involve themselves in debt less than the rest of Europe. However, an economy where people aren’t involved in debt sufficiently, is an economy which does not believe in the future, which doubts its assets, which is afraid of the next day. It’s the reason why I wish to develop the mortgage credit for the households and that the government intervenes to guarantee access to the credit of the sick people. I propose that those which have modest remunerations can guarantee their loan by the value of their housing. The mortgage credit should be reformed. If the recourse to the mortgage were easier, the banks would be focused less on the personal capacity of refunding of the borrower and more on the value of the mortgaged good. This would then benefit directly to all those whose incomes fluctuate, like the temporary workers and many independents.

N. Sarkozy – September 2006

10 Comments
  1. Reply
    donald e
    January 25, 2011 at 2:49 am

    in todays world this could be difficult. what u want to find is a lender who will do a gift of equity if the house is worth 87000 you need 75000 to pay off the mortgage and get 10,000 cash out and that is without closing costs, what u r talking about is a loan to value of 88%, for that you will need good credit in excess of 650 scores, preferably 720 or higher, if you dont have at least 650 and no lates for the last 12-18 months if u can find someone to do this type of loan its going to be on a 2 year ARM with a starting rate somewhere around 9-10% interest rate with an adjustment period every 6 months after the first 2 years tied to the libor rate with a mx increase of 2% each 6 months to a high of 6% over the starting rate of 15-16% in other words starting payment on 75000 if u pay cash for closing costs of 660.00 per month plus taxes and insurance, worst case scenario in 3 years it could go as high as 1000.00 a month plus plus, this is exactly what started the current mortgage problems, and there may not be to many lenders willing to work with u. you must improve your credit scores, settle the repo short fall andlate the mortgage lates from 2006 age at least 24 months, get the cash for closing and work hard on getting a higher appraisal will you are waiting in order tog et the loan to value ratio down, this is going to be tough but possible accomplishable in the next 2 years gl.

  2. Reply
    popopingpong
    January 25, 2011 at 3:25 am

    Tu mériterais une publication dans un journal satirique ! Bravo jeune homme j’aime beaucoup ce que raconte vos images.

  3. Reply
    ~ Pil ~
    January 25, 2011 at 3:55 am

    On peut se tutoyer papy…

  4. Reply
    popopingpong
    January 25, 2011 at 4:42 am

    Oké : T’es trop fort mec !

  5. Reply
    egoteabs
    January 25, 2011 at 5:12 am

    Pil…poil à gratter!

    ;-))

  6. Reply
    can_ka_no_rey
    January 25, 2011 at 6:00 am

    J’aime!
    Quand est-ce que vous venez à Bruxelles? ;o)

  7. Reply
    popopingpong
    January 25, 2011 at 6:29 am

    Hey are u here ?
    Come with us, let’s play !

  8. Reply
    Tyson Blades
    January 25, 2011 at 6:44 am
  9. Reply
    Tobi_2008
    January 25, 2011 at 7:02 am
  10. Reply
    {Plim}
    January 25, 2011 at 7:07 am

    I Think this is Art ! AWARD

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