How Do You Assist Clients With Non-Conventional Property Purchases?
In the complex world of non-conventional property purchases, we've gathered insights from seasoned mortgage professionals to shed light on their unique experiences. From navigating a cross-border purchase to expanding the buyer pool through seller-financing, here are the diverse strategies and loan products used by a Partner, Mortgage Broker, and a Mortgage Banker & Broker among others, in assisting their clients.
- Navigating Cross-Border Purchase
- Utilizing Non-Conventional Programs
- FHA Facilitates Credit-Challenged Buyers
- Seller-Financing Increases Buyer Pool
Navigating Cross-Border Purchase
I had a client who moved from the USA to Canada; she had a PR card. She converted her current USA job to a contract position, so the USA company didn't have to deal with cross-border taxes. She set up an incorporated business here, invoiced her contract position, and ran payroll with her accountant for one month in December. She then filed that year's taxes in Canada for that one month of payroll. I contacted CMHC directly to ensure what we were doing was acceptable to them under their Business for Self Enhanced Program, got a lender on board, and she was able to purchase a home here in Calgary, insured with 10% down.
Utilizing Non-Conventional Programs
As a licensed mortgage banker and broker with relationships with over 70 different lenders, I am able to offer programs regardless of the financial situation of the borrower or the eligibility of the property. As such, I often utilize non-conventional programs to get the borrower approved. For example, I recently assisted a client with an investment purchase, qualifying solely on the future rental income of the property. No tax returns or income were needed from the borrower at all. There are so many programs available outside of conventional financing from which borrowers can immensely benefit, and the process, terms, and rates are similar to those of conventional financing.
FHA Facilitates Credit-Challenged Buyers
I have used FHA financing on multiple occasions to facilitate purchases in cases where my borrower may not have great credit and/or much money to put down. I often use FHA loan scenarios to pre-qualify borrowers because if they can't qualify using FHA, they aren't likely to qualify with any other program. It certainly disproves the myth that a home buyer needs 20% down.
Seller-Financing Increases Buyer Pool
We work with clients that utilize seller-financing. This allows the seller to sell the home, often for a higher price. The seller has the opportunity to earn interest payments that would otherwise go to the bank. Through flexible terms such as length, interest rate, down payment, and balloon payments, the buyer increases the buyer pool and can tailor the agreement to the buyers' and sellers' specific situations. The seller is then holding a mortgage note, which allows her to sell the note if she ever needs a lump sum of cash.
