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Creative Real Estate Financing

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Assumption of Existing Mortgage & Rent to Own

Posted Oct 6 2023, 14:52

Hi Everyone,

I'm looking for some insights into two alternative home financing options: Assuming Fixed Rate Loans and Rent-to-Own.

  1. Assuming Fixed Rate Loans:

    • Does anyone have experience with assuming fixed-rate loans?
    • Is this option only available for FHA loans, or can it be done with other types of mortgages?
  2. Rent-to-Own:
    • Does rent-to-own actually work, or are there limitations?
    • I'm concerned about the negotiating power when trying to buy after renting. Any advice?

Thanks for your help!

Best regards,

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Mohammed Rahman
  • Real Estate Broker
  • New York, NY
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Mohammed Rahman
  • Real Estate Broker
  • New York, NY
Replied Oct 9 2023, 05:59

Hey @Christopher Booth - depends on where you're looking to buy. I've had people tell me in the midwest and south it's not unheard of, but here in NYC you're not going to have the easiest time because sellers have little to no incentive (there's always demand here). 

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Ron S.#1 Foreclosures Contributor
  • Paradise, CA
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Ron S.#1 Foreclosures Contributor
  • Paradise, CA
Replied Nov 8 2023, 10:48

Its difficult to legitimately "assume" a loan unless its VA and only a fool would let you assume their VA loan. you'll more than likely assume it subject to and then its the old get your deal done before the lender accelerates Wack amole game.

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