Closing on my first house!

2 Replies

So after house hunting for a little over a month, I just got the news today that my offer got accepted for my first house! This is my first ever experience buying a house and although the process isn't over it has been quite exciting so far. During the time I saw 6 houses total and made 1 offer on another home, but lost in a bidding war on a house that had over 10 offers. I felt pretty comfortable with what I was looking for and I knew what I wanted, so that is why I only saw 6 houses. 

The house has great equity and the VA remolded just about everything. The only thing is the kitchen cabinets need to be replaced. I will be able to "house hack" right away as I already have a roommate moving in with me, so that will help build my equity. It is a 3 bedroom/ 2 bath so getting a 2nd roommate will be a in my future plans.

I decided to pay the house in cash, in large part due to having no credit, which made it impossible to get pre approved for a loan. I would have liked to take a 15 year mortgage but given the circumstances that was not going to be possible. I do have one newbie question..

I was wondering in the future if I wanted to take a lien on the property would I have any problems because I do not any credit? or because I own the property that won't matter?

I am planning on building my credit but it is going to take a coupe of years, and the only way I would be able to buy another property would be to take a lien on my mortgage or find a private money lender. 

Thanks for reading,

Brett Campbell

Congratulations on your first home! From my conversation with bankers, someone who is looking to get an equity line on their home from a bank with no credit will almost always be denied or will have a ridiculously high interest rate. But I don't know how high it would be.

I don't really have experience with conventional financing as I am a hard money lender. You may be able to find a hard money lender to help you out, but on an owner occupied home it's quite difficult since most hard money lenders lend on investment properties only.

I would strongly suggest that you begin building your credit. Hope someone else here can provide a better answer.

Thank you Jackelyn I will definitely be building up my credit in the near future. It's so frustrating knowing I am financially stable and the banks will not consider giving me a loan because I have no credit. Yet they will give loans to somebody who has an awful credit history, but has built up their credit enough in the last few months. If you can't tell I listen to Dave Ramsey a lot lol. 

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