To qualify for an FHA-backed mortgage, you’ll need a credit score of at least 580, though minimum score requirements will vary by lender.
Now contract for deed homes you can purchase with almost any credit. Some sellers may be sticklers on this but not many. Usually you can find a home with a Bankruptcy-Foreclosure-Child support on your credit.
We have done alot of them and will continue to do alot more.
The terms on most contract for deeds in Minnesota and Western Wisconsin are.
- 10% down of the sale price of the house.
- Rates are negotiable but usually 5-7% amortized over 30 years
- Balloon in 3-5 years.
Below you will find cities located in Minnesota that may have contract for deed homes for sale.
11-county metropolitan area: Anoka, Carver, Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, and Wright. These counties include the cities of Minneapolis and St. Paul (the Twin Cities) and contain about 60 percent of Minnesota’s population therefore a lot more contract for deed properties available in these locations.
Contact us today we also have financing options thru a lender that you may qualify for as low as a $1000 down to purchase a home.
Speed, simplicity appeal to buyers
Homebuyers may be attracted to a contract for deed purchase for several reasons. This method may be especially appealing to homebuyers who do not qualify for a mortgage, such as people who work cash jobs and are therefore unable to prove their ability to make payments. Since the contract for deed process is significantly shorter than the mortgage-approval process, it may attract buyers who face time constraints or have limited options, such as people who are losing their homes to foreclosure. First-time homebuyers who lack experience in the market or individuals who are wary of traditional financial organizations may also choose a contract for deed because of the relative simplicity of the buying process.
- First and foremost, the seller must set forth the terms of the contract in a purchase agreement. It is important that both parties fully understand the provisions of the contract, because once the purchase agreement has been signed, the options available to both the seller and buyer are limited.
- The buyer should know whether he or she is responsible for property tax payments and insurance and whether the contract for deed includes a balloon payment. If it does include one, the buyer should be certain that he or she would be eligible for a mortgage to cover the payment when it comes due.
- The buyer should also make sure that the seller is the true owner of the house by checking with the county recorder’s office to see who is listed as the registered owner. If the seller still has a mortgage encumbering the property or is responsible for paying the taxes or insurance, the buyer should contact the seller’s mortgage company prior to signing the contract to determine whether the seller is current on his or her payments. Some “scam” sellers will retain a buyer’s payments and not apply them to the mortgage. If the seller defaults on the mortgage in this scenario and the home is foreclosed, the buyer will lose the house and all the paid installments.
- The buyer should ask the seller for a Truth in Sale of Housing report to determine the condition of the house. This report is required in Minneapolis and St. Paul and some other cities. In cities where it is not required, the seller should find his or her own inspector to assess the condition of the home.
Once the contract for deed is executed, the buyer should record the contract immediately with the county recorder’s office or the registrar of titles it is the law in Minnesota.
If you close with a title company or law office you will have that taken care for you. I highly recommend using a title company to close a contract for deed sale.
For drafting the purchase agreement and looking at homes call us.
Contract for deed specialist.