Buying a home that is too low priced to qualify for a mortgage
Hi,
I am interested in buying a two flat in my area for rehab, and then I will live in one unit and rent out the other. I understand now that such a low priced property isn't profitable for a traditional bank or mortgage broker.
My friend's mom has a few properties she rents out, and she suggested that I consider a personal loan/line of credit. I am very open to this, but not sure: (1) where to go (2) why they would let me use a loan to buy a home for a price that wouldn't meet mortgage standards. Are online lenders okay? I feel a bit queasy about going to an online lender, but I have never had a mortgage before, so I am queasy about this whole thing, to be honest.
I have $5k in savings, my car is paid for, and my credit score is decent. I have a solid job, so I think income shouldn't be a problem. The places I am considering buying are all undr $30K, and all need substantial repairs, up to $30 in repairs. What are my alternatives? I know that one alternative is to spend more, enough to qualify for a traditional mortgage. I would like to avoid that because I would like to avoid early payment penalties, and I have my heart set on one of several properties for personal reasons.
Thanks in advance!