Chances are, if you’ve recently immigrated and settled in the US, your credit history is likely nonexistent. Or maybe, you’re young, and so far in life, your parents have helped out financially. Either way, there’s one thing both of these demographics have in common, and that is: zero credit score.
Nonetheless, if that is the case and you’re trying to secure a loan to buy yourself a house, you’re probably stuck in a pickle. Perhaps you’re wondering how to get a loan with no credit, but is that even possible?
The short answer? Yes.
The long answer? Read this blog to find out.
What is a Real Estate Loan?
A real estate loan is a fancy word to refer to mortgage, something you’ve probably heard before. It’s when someone looking to buy a house or property takes a loan from a reputable firm. However, they are required to pay back the loan with an additional interest fee. This is further corroborated by signing a legal contract that binds the lendee to the lender’s terms.
How to Get a Real Estate Property Loan With No Credit?
Although it might seem impossible to do anything with no credit, there are various ways you can acquire a loan. However, in most cases, seeking a traditional bank loan only ends in disappointment, especially when your empty credit score stares back at them. That is why to get a good deal; you’re going to have to get a little creative. Here are five unique solutions you can follow:
1. Find a Private Money Lender
As fishy as it sounds, a private lender helps to provide you with the direct funding you need. This can either be a person or a funding firm that works with you in detail, forming a relationship of trust. This way, they might overlook your lack of credit as long as you provide them with enough credibility.
2. Go for a Hard Loan
Rather than focusing on the borrower’s credit or total income, a hard loan is a solution that relies on the value of the property. This option usually works the best with house flippers since money lenders tend to lean towards properties with a high after-repair value.
3. Look for Investors
Rather than taking up all the burden on yourself, try looking for an investor instead. If you know someone with a decent credit score who might be interested in real estate investment, hit them up! However, keep in mind that the profit you make will have to be split in two so you can share it with them equally.
4. Consider Seller Financing
Seller financing is a type of investment property financing. It’s when the seller and buyer come to terms and decide on an installment payment plan. This is also known as Owner Financing. The details, ranging from mode of payment, time, interest, etc., are all included in a promissory note that holds legal value.
5. Hire a Real Estate Wholesaler
A real estate wholesaler is someone who acts as a mediator between the seller and buyer. These people find properties below market value and then further help get the paperwork you need to finalize the deal. Real estate wholesalers usually take a special fee for securing a good deal, along with their regular charges.
Where Can I Get a Loan for my Real Estate Property?
Lastly, now that you know how to get a loan with no credit, you’re all set for your big investment. ContactRed Door Funding at (832) 539-1099 for more information on real estate investment and property loans.