My partner and i are looking at buying our first property. We both have exisiting student debts which we are paying off. Somebody recently told us you can take out a mortgage with an option to use some of the money to pay off existing debts. Does anyone know if this is true and if this is a good option. We are both paying high interest rates on the debts and it will take us years to clear them at this point. Any advice??
2007-03-26 02:31:25 · 5 answers · asked by Belinda 2 in Business & Finance ➔ Renting & Real Estate
I would refinance your debts. You can get a really low interest rate on your student loans. I did that with my loans and I am paying 4% on my student loan. Your best bet with a mortgage is to do a straight mortgage with 20% down if you can't do that you can get a loan for 100% of the loan but you will have to pay PMI insurance which isn't that much. You only have to pay the PMI insurance until you reach 20% that is what I am doing. You can also get an interest only loan but they are only good for 5 years and you only pay the interest and none of the principle. After 5 years you can sell the house and hopefully make enough to pay it off or you can refinance. As far as getting money to pay off your loans I have never heard of that. I know there are companies that will loan you more than what the house cost but you have to pay that back with interest. If you can refinance your debts you will get a lower interest rate and in my opinion that will be better.
2007-03-26 02:42:06 · answer #1 · answered by ♫Rock'n'Rob♫ 6 · 0⤊ 1⤋
You will only be able to get a mortgage up to the value of the house or the purchase price of the house, whichever is lower. In any event, to pay student debts off over 25 years would be ludicrous as the interest you pay over that period will far outweigh the interest over 5 years or however long you are paying these debts over. However beware, as the income multiple they use to calculate how much a lender will lend you also counts against your loans eg if you are able to borrow 3 times your combined salary and your loans are £10k then they will deduct £30k from your borrowing potential.
2007-03-26 02:40:24 · answer #2 · answered by Anonymous · 0⤊ 1⤋
You can get some basic information about investment loans at http://www.fivestarsmortgage.com/investor-loan/.
Normally it's on a refinance that people take out cash to pay off debts versus on a purchase.
If your serious about looking into getting financing feel free to contact us. You will be taken care of.
2007-03-26 03:13:09 · answer #3 · answered by Anonymous · 0⤊ 0⤋
First, there is a product out there for this. However, you have to have a good credit score, and a good credit profile, and the rate is not very forgiving. It's generally not a good idea, because it goes into over-equity lending, and that's a specialty product that only helps certain people.
2007-03-26 02:43:24 · answer #4 · answered by togashiyokuni2001 6 · 0⤊ 1⤋
Belinda,
I can help you with some great resources. Just shoot me an email to msmith@premierloangroup.com, aand I'll see what we can do!
Marty
2007-03-26 02:34:52 · answer #5 · answered by Anonymous · 0⤊ 1⤋