How To Buy A Home And Stay Liquid
Posted by
eli
on 1/16/10• Categorized as Real Estate
A reader asks: How can I buy a house and stay liquid? What is the best sources of funds in buying a home? 
Buying a home (house and lot) or any other real estate property is one of the biggest purchases you will make –an investment for a lifetime.
To stay liquid and leverage your own funds (either your savings, borrowed money, proceeds from sale of other properties) it is wise to seek financing when buying your house.
Below are the financing options available which you can consider:
1. Loan from Pag IBIG Fund. Pag-IBIG provides low-interest housing loans to its members payable in 30 years, on a monthly installment.
2. Assumable loans. You can take over someone else home mortgage, such as the one available in the National Home Mortgage and Finance Corporation (NHMFC), or in the Pag-IBIG, or in the Government Service Insurance Corporation (GSIS).
3. Lease-To-Purchase. Renting a home with an option to buy at the end of a specific period or during the lifetime of the lease contract. It must be specified in your Lease To Purchase Agreement with the owner. Presently there are owners / developers who offer this kind of feature of home ownership.
4. In-House Subdivision Financing. Some subdivision developers/owners provide in-house financing to home buyers. Check this offer in the subdivision where you want to buy your house.
5. Bank Financing. Commercial banks grant housing loans for building a house, by using your lot as collateral. You will execute in favor of the bank a real estate mortgage (REM) which includes the terms and conditions of the loan, the interest rates, amortization period, and other provisions.
Buying a home does not necessarily involves all cash from your own pocket and a one-shot deal payment with a huge cash out which will make you cash-strapped as a result. There are other options available, like the foregoing home financing alternatives.
This way, you can still have a home and stay liquid.
My husband and I are considering the “lease to purchase” option with our home. The landlord will carry the note at a little higher rate than the conventional loans. The payments would still be what we are paying in our monthly rent. The down payment is reasonable. It did bring up a whole new set of questions for us. One of the questions in particular was “Are we sure we want to live where we are at for the next 10 years?” We’ve stopped the process for a bit to allow us to weigh the pros and cons.