Seller Financing in Minneapolis with no or low money down?

[Kayla Wagenmann]

My partner and I have been considering purchasing a duplex as an investment for our first home. We moved back to Minneapolis last year after living in Los Angeles for 2 years. We have been renting for the past year at $1200/month.

Sadly, I do not qualify for an FHA loan at this time because I took a second job in April that effectively split my income in half. I was informed that I need to work both jobs for two consecutive years for the lender to count both jobs as income. My total income did not change when I took the new job. I reduced my hours at my first job to take the second. I make $72k between the two jobs with the potential to make more with overtime as I'm a nurse.

A couple weeks ago, our dog tragically killed our upstairs neighbor's cat when we let him outside in our fenced yard. Our neighbor is the son of our landlord, who we have had a relationship with for the past 9 years. Our neighbors have informed us that they plan to get another cat and would be uncomfortable with us living there with our dog. They said it is "no rush" but would "appreciate" if we found somewhere else to live.

We had planned on taking the next 1.5-2 years to save money for a duplex. The idea of paying for moving expenses just to move into another rental makes me feel sick. We would likely end up spending more on rent since we have a dog and two cats and this makes finding a rental difficult.

How difficult is it to find owner financing deals? We don't have a lot of money saved up (only 2,500). I do have a personal line of credit with a 10k limit at 10% interest that I could use if needed. I also have about 20k in retirement funds that I would prefer not to tap into but would consider for the right deal. My partner and I make about 100k in combined income.

Any advice would be appreciated. Do you think it is worth our time to explore seller financing or should we just bite the bullet, find another rental, and continue to save until we can qualify for an FHA loan in 2 years?

[Bruce Runn]

@Kayla Wagenmann

Seller financing is really tough to find.  Not impossible but...

I'd suggest continuing to pay down all the debt you can as you have been doing.  I'm a huge advocate for House Hacking as it's the most affordable way to own a home.  Keep saving and working down debt and get to know a banker that will tell you what you need and be willing to work with you