If you can come with 5% or 10% down, you can choose an upfront PMI premium and pay it in cash or finance it on top of your loan as opposed to the monthly option. Amount is really fair, esp if you have great credit.

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Posted by FootballNostradamus

Member since Nov 2009

20509 posts

Posted on 9/6/13 at 11:59 pm to KG6

quote:
Could it be that housing prices are so high because people don't feel like they need to put down 20% anymore. If I'm selling my house and I can sell it for 50k more if a bank is willing to lend that money to someone without them needing the extra down-payment money, then I'm going to do that. Obviously other factors go into the value of a home, but I think over time, the fact that you can get loans without serious down-payment has caused housing prices to rise.

This is undeniable. Also, the fact that in the old days local banks handled almost all mortgages. They were 100x more invested in whether the mortgage was repaid or not as it was their premium on the line. Nowadays these national institutions handout mortgages like they're balloons then bundle them and sell them to Wall Street.

It's absurd.

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Posted by pottymouth

Hell

Member since Jul 2011

89 posts

Posted on 9/7/13 at 3:50 pm to cberni1

quote:
I know thats ideal but how realistic is it for a first time home buyer to come up with 20k on a 100k house which will likely be a dump. I never could see how that all worked out for younger people starting out, like myself.

Extremely realistic. We did it on one income with one of us still in school. That house subsequently doubled in value in 7 years. Had the next house halfway paid off with the proceeds from the sale of the first.

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