re: Can you still get 100% financing?

Rural Development loans.
Great rate, no Mortgage Insurance.
Only thing is that there are geographical and income restrictions.

I'm closing on a house tomorrow that I sold to a young man that's getting a rural development loan. I've actually had quite a few using it this year. They have very good income, have good credit, but are young and haven't had a chance to save up a down payment.

I used to be the head of the loan department for a commercial bank in the 70's and we always required 30% down. By the way, those were the Carter years with 15% and up interest rates.

I didn't like selling houses to people with so little money down when I first started selling R/E years ago, but I always try to make sure my clients understand what they're getting into, I've rarely had anyone take out an ARM and I've never known of any house I've sold being foreclosed on.

I bought a house in May 100% financing with a RD loan. Definitely helped my arse. I make good money and have a lot saved, but they always say don't spend your life savings on your first place, you'll live there for no more than 5 years. Then put your equity in to your next house down payment. Makes sense to me.

quote:

---

How is that the problem if someone is obvious qualified?

---

I'd say if you are unable, or unwilling, to put 20% (minimum) down on something as important as a house, then you are by definition...unqualified.

quote:

---

I'd say if you are unable, or unwilling, to put 20% (minimum) down on something as important as a house, then you are by definition...unqualified.

---

I'd say 20% is an arbitrary figure that is steeped in tradition. I do agree that some deposit is required, but who's to say someone putting up 5%, 10% or 15% are inherently unfit for home ownership?

quote:

---

What makes you want to own rather than rent a home right now? It is expected that the market will continue to trend downward and then sideways for the next several years. I wouldn't expect much home appreciation for at least 5 years possibly as many as 10.

---

Not looking to buy right now, plan on holding off for at least a year. Problem is finding a roommate.

Nicky I see what you are saying as being qualified but life sometimes throws things at you that are beyond your control.

I'll give you my story. When I lived in Austin back in 2000-2003, at the height of the whole dot com thing I purchased a home that I only put 5% down on. I was making $50,000 when I bought it, the home was $150,000. I had outstanding credit, never late on any payments, under $1000 in credit card debt, I was pretty responsible financially.

I was laid off in 2003 and decided to move back to Baton Rouge. I put the house up for sale only to find that it was now valued at around $135,000 because the market crashed out there due to do many people losing jobs. I was able to rent it for about 6 months and make payments for another two but then just could not do it any more. We ended up doing a short sale on the home which still affects your credit.

My point is you may be "qualified" but I do not recommend anything less than 10%, 15% is better, but 20% is a good mark.

I chalk that one up to being young and dumb. I also had around 40,000 shares of stock in the company I worked for of which about 16,000 of them were fully vested at the end. At the peak the stock was around $178 a share and I sold may 250 shares total because I didn't understand it enough. I made zero from that when I could have at least had a nice little savings account for rainy days.

Damn you mean that a 16 year old cant go into a mortgage company and buy a house with no money.....dont you know that its their right to own a house.......