Dream Homes: The Challenge of Financing Unique Homes

Smaller lenders tend to offer more favorable mortgage terms for buyers who want to purchase a home that does not fit the mold of other houses in the area.

Even if you have excellent credit and a low debt-to-income ratio, purchasing the house of your dreams can be a challenge if it is unique, according to a recent article in the New York Times. Whether you are buying a historic home in a neighborhood surrounding by new homes or you want to purchase a LEED certified green home that is one of the first in your area, you may find that large institutional lenders are reluctant to offer you mortgage financing. For those who do, they may require a substantially higher down payment than if you were to buy a home that is more in line with other homes in the area.

Smaller Mortgage Brokers Help You Purchase the Home of Your Dreams

The main reason it is difficult to obtain a mortgage when you buy a unique home is that, by its very nature, it is difficult, if not impossible, to find a recently sold home to use as a comp. This make it a challenge to establish the fair market value of the home. While large lenders tend to have rigid criteria when evaluating mortgage applications, a smaller independent mortgage broker knows the local market and takes a personalized approach when determining whether to approve your application. This makes it much more likely that you’ll be able to purchase the home of your dreams.