There are few ways in which you are able to finance real estate.
The traditional way to finance real estate is through a credit union, a bank or another home mortgage company.
However, the criteria in order to get finance from one of these institutions are strict.
You will need to have a great credit score of 680 or better. You will also have to provide full documentation of income and debts.
Seller Carry Back
If you hear of someone talking about buying on terms then they are talking about creative financing.
This refers to any financing method that is not traditional. You will need to know these methods so that you can buy properties using Other Peoples Money. Investors will usually try and use as little of their own money as possible.
The seller carry back is a form of owner financing where the seller will agree to carry the note for the purchase. This will work when you find a seller that owns their house free and clear. They do want the property anymore and are fine with receiving monthly payments on it.
The seller will usually have a time limit in place for when the note has to be paid in full.
The subject to method allows you to finance real estate quickly, but it is a short-term solution.
You will buy the property on the condition that existed finance stays in place. The title is transferred, but the home loan stays in the sellers name and the buyer makes the payments. This is short term, as the seller will not like having the loan in their name for a long period of time.
This method means that the seller provides a second mortgage. This will be enough to cover the down payment.
The lease option means that you get into the house for little to no money down and you are able to buy the property in the future. This gives you the time to get the fund together.