Purchase Price Loans in Kansas City, MO
Crossroads Investment Lending on Loans for Purchase Price
Crossroads Investment Lending is a Kansas City-based financial firm that specializes in purchase price loans, also known as purchase money loans. A purchase money loan is a type of loan that the seller of the property provides to the buyer, eliminating the need for financial institutions or lenders. These loans are typically used in real estate transactions when the buyer doesn’t qualify for standard bank financing.
What Is a Purchase Price Only Loan?
A purchase price-only loan, or purchase money loan, is a type of loan that the seller of the property provides to the buyer. This eliminates the need for traditional financial institutions and lenders as it involves just two parties: The purchaser and the seller. The purchase price only loans are typically used in real estate transactions where a normal bank loan is not an option.
Why Are the Loan Amount and Purchase Price Different?
The loan amount and purchase price of purchase money loans can vary greatly due to several factors, such as the buyer’s credit score or down payment. The purchase price only loan is not based on the purchase price of a home but instead on the appraised value of a property. As such, purchase money loans allow for more flexibility than traditional mortgages. Additionally, purchase price loans don’t include closing costs or pre-paid items that are typically associated with traditional mortgages. This makes purchase price-only loans an attractive option for many homebuyers.
Types of Purchase Price Loans and When to Use Them
When purchasing a home, purchase money loans may be the best option if standard bank financing is not available. Purchase price only loans can also be used to purchase land or make improvements on existing property. There are several different types of purchase price loans that are available: land contract, lease option agreements, lease-purchase agreements, assuming the seller’s mortgage, and hard money loans. Each type of purchase money loan has its own advantages and disadvantages, and it is important to understand the differences before deciding.
- Land Contract – A land contract is an agreement between the buyer and seller that allows for purchase price payments over a period, usually over three to seven years. Typically, the purchase price is paid in monthly installments with interest until it is paid off in full.
- Lease Option Agreement – A lease option agreement is a purchase price loan that allows the buyer to purchase the property at the end of a specified period, usually six months or more. During this time, the buyer pays rent and has the option of purchasing the property for an agreed-upon purchase price.
- Lease-Purchase Agreement – A lease-purchase agreement is like a lease option agreement, with the difference being that it allows the buyer to purchase the property at any time during the agreed-upon period. The purchase price is typically locked in prior to signing the purchase agreement.
- Assuming the Seller’s Mortgage – This type of purchase money loan involves taking over ownership of an existing mortgage from a previous homeowner. This purchase money loan option can be beneficial to the buyer, as it allows them to purchase a home without having to pay closing costs and other fees associated with the purchase.
- Hard Money Loans – Hard money loans are typically used for short-term financing of real estate purchases, repairs, or renovations. These loans have a higher interest rate than traditional mortgages but may be more accessible for those with lower credit scores or a limited down payment.
Benefits of Purchase Price Loans
- Lower Interest Rates – Purchase money loans typically have lower interest rates than traditional mortgages. This can save buyers money in the long run.
- Flexibility – Purchase price loans offer more flexibility than traditional mortgages, allowing for purchase prices that are higher or lower than the purchase price of a home.
- Lower Fees – Purchase price loans don’t include pre-paid items or closing costs that are typically associated with traditional mortgages. This can save buyers money when purchasing a home.
- Fast Approval – Purchase price loans are typically easier and faster to obtain than traditional mortgages, allowing buyers to purchase a home more quickly than with a standard loan.
- Accessibility – Hard money loans are available for those with lower credit scores or limited down payments, making purchase price loans more accessible for those who may not qualify for traditional mortgages.
Understanding the differences between purchase money loans and traditional mortgages is essential to make an informed decision when purchasing a home. With purchase price loans, buyers can get the same benefits as traditional mortgage financing without the added costs or time delays associated with pre-paid items or closing costs. Ultimately, purchase price loans can help buyers purchase a home more quickly and at a lower cost than traditional mortgage financing.
How Can Crossroads Investment Lending Help?
Crossroads Investment Lending wants to ensure that all of our customers get the loan they need to purchase their desired property. Our purchase price only loans are designed to provide buyers with flexible financing options and competitive rates. We understand that purchase price loans may not be the right fit for all homebuyers, which is why we offer personalized consultations to ensure you find a loan solution that meets your needs. With our specialized purchase money loan services and knowledgeable staff, you can purchase your dream home with confidence.
Contact Us for Help with Purchase Price Loans
Take the next step today and contact us today at Crossroads Investment Lending for purchase price-only loans in Kansas City, MO. We’ll help you purchase the property of your dreams quickly and easily!
Why Choose Us?
- Family Owned & Operated
- Local Fix & Flip Finance Experience
- All Credit Scores Considered
- Close in 7-10 Business Days
- Short Term Loan for Investment Projects