Buying home listed 15% below market..hard money loan needed

[James Walker]

I am in the process of purchasing a home from a family friend. I am a veteran and I have to wait 40 weeks plus to get my COE. They want to sell within the next 3 to 4 months. My credit is subpar, but increasing, my debt to income ratio is above average, my payment history is lagging over the next 12 months so approval for an FHA or any other long seems grim. What options do I have short term until I am able to refinance the home once I can get better approval rates or approved for VA loan

[James Walker]

Quote from @Patrick Roberts:

Based on what you've described, seller financing or having someone else buy the house and lease it to you with a purchase option until youre able to qualify are likely your two best options. Having someone else be a coborrower on the loan with you to bring the needed income could be an option, but it sounds like your credit will be an issue. 

Hard money is only offered on investment properties in 99.99% of situations - since this will be owner occupied, that is basically not on the table. 

Seller financing is a great option in scenarios like this, but this pathway is dependent on what the seller needs. If they want their cash now, this can be tougher to execute. There are a few ways to structure the paper so that it can be sold quickly (within 6-12 months or so) without a huge discount, but ultimately, if the seller wants their money within the first year after selling financing, theyre going to take some kind of a haircut. 

I buy seller finance notes in SC and also lend in SC. Give me a call if you want to walk through the ins and outs of seller financing so you can present the idea to the seller. 

The sellers do need their cash pretty soon. We leased with an option to buy for the first 6mos and they gave us an "extension" for another 6mos to work this out. This VA issue has taken longer than expected. I would like to discuss options for someone else to purchase and I buy from them. Would that be an investor, friend, family member? I've talked to a few people about this, but no takers yet.