So if uses my credit to get the home and he already has someone who wants the home. Will they have to be in the home at least one year for me to sell it and if so what if the people decide to just leave the home without paying rent. That means I would be stuck with the house in my name and under my credit. Right? It just sounds like a scam to me!
2007-03-02 08:03:11 · 10 answers · asked by bigboy_dray 1 in Business & Finance ➔ Investing
Sounds like a scam to me too. If you want to buy and resell a house, you don't need someone else to use your credit to buy the house. You buy it yourself and then use a licensed real estate agent to find a buyer.
2007-03-02 08:11:36 · answer #1 · answered by BosCFA 5 · 1⤊ 0⤋
Actually it's not a scam. This is what they call straw buyer. It isn't really something that the DRE would endorse. They actually hate it. It is called Creative Financing. Most banks are conventional and most agents are the same. Only a few realtors and lenders are thinking outside of the box.
In your case, if the guy whom you are working with finds you a property that has enough equity in it to service the mortgage for a year or two and able to pay you for your services then it's a good deal. That way you keep your income, you can rent it out or stay there and not worry about the mortgage because it is paid up. During this time your credit is getting stronger and the guy you are working with is getting what he would like as well. It is usually a win win situation.
Even if you decide to keep the place, what I would do is continue servicing my mortgage. That means as long as the appreciation in your home continues to rise, refi and do a cashout. Put the cash in escrow to service your mortgage payments. that way you continue to keep your credit strong and you've then become an investor.
I know a few people that has done this and I've done loans for this. I work with many investors.
Again, this isn't something that you would want the world to know because EVEN THOUGH IT IS LEGAL, the Banks and DRE frown on it.
It is good for people with no credit or money. Hence buying a property with little to NO MONEY DOWN. CREATIVE FINANCING.
Just do your research on the property and know your comps and information before signing.
If you have any questions please contact me.
law_edavis@yahoo.com
What state are you in?
2007-03-08 15:20:30 · answer #2 · answered by Lawrence D 1 · 0⤊ 1⤋
You most likly won't get the money you put in the house back the housing market is going in the craper from now until 2009 that is a fact. I would not do it I would wait till 2009 to buy a house. If you buy a house you can sell it the day after you don't have to wait 1 year. It sounds like a scam to me plus if they damage the house you will have to pay for that too before you sell it. My friend did it with some one he knew for 3 years the guy was a drug dealer he made the payments for a couple years and then he got busted went to jail. My friend was stuck with the house but he did make 20000 profit off the sale of the house.I would talk to the buyers and I hope you know this guy very well and check his crime records at the court house.
2007-03-02 17:47:16 · answer #3 · answered by franksprung 3 · 0⤊ 0⤋
You have the credit, he has the buyer, right? Or is this an income?
In either case, if your name is on the deed, its yours. You are responsible for the payments and all that goes with it.
You are right to be cautious. This is not something to take on lightly.
The key sentence is, "He will use my good credit."
If he doesn't have good credit, why?
Check all your information twice, sleep on it and think some more. Ask a realtor what the house is worth, how is the market in the neighborhood, what about the neighborhood period?
Good luck, sorry I wasnt more help
2007-03-02 16:30:43 · answer #4 · answered by Ann S 3 · 0⤊ 0⤋
Listen, I'm thinking you might not want someone else using your name to better themselves. There is a reason he is using your name...his is bad! Don't do this...your credit and credit score could be ruined by this guy. And in this world...your credit is so important, it can get you what you want or you could be in major dept after this guy finishes with you. Beware of anyone who is trying to use you to better themselves. Be careful and just say "NO!!!" Try to do things that are this important on your own or ask for the advice of an attorney that handles realestate. Good Luck
2007-03-10 03:59:29 · answer #5 · answered by poodlemama1965 2 · 0⤊ 0⤋
If your using your credit. You are responsible for the mortgage payment. If you have a renter and they move out you are the one responsible for the mortgage. If it is used as a buy/sell property. you can turn around and resell it for a profit whenever you choose to. If he is a business partner and doing that i wouldn't have any problem doing that but, if it is used as a rental property I would personally do it myself without this middle man. that way it sounds like a scam
2007-03-09 12:56:18 · answer #6 · answered by brandonmmarlow 1 · 0⤊ 1⤋
Whoa cowboy! If you feel uneasy enough about the deal to ask the question in this forum ........you probably already know the answer.
If this guy was someone that you wanted to do business with you would damn sure make certain he has his own credit!
2007-03-06 22:46:58 · answer #7 · answered by Anonymous · 0⤊ 0⤋
DON"T DO IT!! SCAM
If you are ready to invest in real estate then do it on your own. Just find a property you like at a good price, find a real estate agent and dive in!
2007-03-02 16:14:12 · answer #8 · answered by Scott O 3 · 1⤊ 0⤋
yes huge scam. don't do it. Rule for life: if it sounds to good to be true, then it is!
don't put your credit in jepordy
2007-03-02 16:11:23 · answer #9 · answered by tommypski 2 · 1⤊ 0⤋
Be careful who you trust with you're private information and money!
2007-03-02 16:08:11 · answer #10 · answered by Anonymous · 1⤊ 0⤋