"Unofficial" p2p lending....

I know there are a number of members on here that deal with real estate so I figure I would ask.
I understand that even p2p lending companies ie lendingtree require a min credit score of 620. Is there anything local or any company you have heard of through which 2 people can come to a loan agreement without the use of credit scores and different algorithms but on a pure person to person basis ie over coffee, multiple meets, where collateral can play a big role as well? All of this documented and legally binding.

After coming to America, growing up I made a ton of poor decisions that did not do any good for my credit score, history and the general American culture of credit playing a huge role. I was taught more of the Eastern European culture of living where banks and credit doesn’t really play a role, in Ukraine and Belarus, the apr for mortgage is in the 25%+ so nobody wants to deal with it.

So when it comes down to it, my credit is crap and most of my cash always went to things like tools , appliances, cars etc. I want to buy a piece of land that is being sold for $8900 that is in a perfect location not far from where I live. I want to buy it before somebody else does of course.

I am currently trying to get my credit score up with a secured credit card but I imagine that will take a year at least.

What are my options. If my only option is to wait and try to increase credit score, is there a reputable local company or bank that can help guide through that? I mean something personable and not the regular BoA agent trying to push a loan. I’ve done a lot of reading and the answer there is all about the credit score.

I guess I’m looking for something that is a bit more “real” and negotiated that looks at the real situation rather than arbitrary numbers. I know plenty of people whose credit scores are in the 700’s and can get any credit they wish, but if they were to lose their jobs/injury, they would end up on the street.

Whatever the case, the ultimate goal is a mortgage to build a home or buy one depending on the land situation, in a couple years. By that time I have to get my credit score up either way.

Any advice would be much appreciated. :slight_smile:

So basically you’re looking for Jim’s Bank from Family Guy?

What it sounds like you need is someone with good credit who trusts you enough to co-sign on a loan with you. You could probably even draw up a crude legal document with the help of google signing some collateral over to your co-signer should you default.

Private mortgages exist, but expect to pay upward or above 10% interest with a very short repayment period, usually five or less years. Any attorney can draw up paperwork on a real estate closing to assign a private mortgage. I have both received private financing in the past which I quickly converted out as part of acquisitions for investment properties and conversely have given private mortgages also for short term deals, but I generally don’t like to in NYS because NYS makes it extremely hard for me to take your thing from you if you don’t pay me back. You’ll find that most of the “brokers” that exchange in private mortgages also will not service NYS for that same reason.

IMO, your best bet is to see if the seller of a property will finance the property if it’s a “for sale by owner” situation. You may need to pay over asking price since the seller will have to wait for their money and you still may pay high levels of interest on top of that, but if get a good real estate attorney and make your payments and it’ll be fine. It’s worth noting that in most cases, private finance is not reported to credit bureaus (unless you default and they get a judgement), so private financing would not help you improve your credit score. That said, mortgage balances and installment lending do drastically help your credit score from a legit fiscal institution - way more than any credit card. Therefore, cutting a deal to buy the land via owner financing is a potential possibility and later obtaining a real construction mortgage via a conventional bank is also a possibility assuming you improve the credit score and history.

I hope that helps!

ok thanks guys