Home Buying Question

[RyanbabZ71]

Guys I was just wondering how much money you put down on a house. Is there a certain % or do they request a certain amount. I was checking some out and they want like $35K down

 

I am looking in the next yr or 2 to purchase a home and id like to start preparing.

[jmhornz71]

Depends on what type of loan you get. There are loans out there with 5% down or zero down. VA loans don't require any down payment if you qualify for one. If you get a conventional loan 20% down will preclude you having to pay mortgage inurance which can run $40 or more amonth. Just check with a mortgage broker and find whats best for your needs

[MarkD]

5% is usually required. Again 20% means you don't have to pay PMI(personal mortgage insurance). Our PMI is $47/month. I can't wait intil I am below 80% financed. BTW, 30 year mortgage, paid for 2 years at $1000/month, after 2 years, owe w/i $3k of amount financed ($22k in fees and interest in 2 years).

[01Burb]

Remember that closing costs on a house purchase (not a refi) could be another 5%.

 

Also, consider a 15 year loan. If I had done that, I would now own my house - as it is I have 10 more years. I couldn't afford a 15 at the time - payments too high but nowadays with rates so low, you could actually pay off your house quick.

[RyanbabZ71]

Thanks guys. I dont know if id go for the 15 or 30 yr. My parents went with a 30 yr and paid it off after like 20. I hope to put as much down as possibe and pay it off asap.

[Z71GUY]

This is a good question for me as well.... Ryan were in the same boat... hope to own a house within 2 years. My parents told me to make sure we have atleast 15% to put down and go for the 15 year, if interest rates stay close to were they are now.

[MarkD]

We refinanced from 30 (28 remaining) to 15 years. Our payment went from $900 up to $988 to cut off 15 years!

[frdfandc]

Just a little FYI. Whether you get the 30 yr or the 15 yr mortgage, its best to try and add alittle extra each month if possible. My parents make 13 payments a year and by the time they are done, it will have knocked off 8 years off the mortgage. As far as your monthly payment goes, approx 80% of that goes directly to interest. So even if you can only afford an extra $100 bux a month, that $100 bux goes directly to the principle. That $100 extra bux each month really adds up.

[99silveradoz71]

I put down about $16,000 on my house and the total initially was around $160,000. I went with a 30yr being single and having the student loan to pay yet for a bit longer.

[Worktruck]

We bought our house on a first time home buyer program. No down payment and no PMI. Actually wrote us a check at closing to reimburse for inspections and such. Interest rate was 5.5% and that was 5 years ago. You should check with the state you live in and see if these oppertunities exist where you live. Good luck. Owning your own home is great, it really is the start of "The American Dream".

[422 SS]

I put down as little as possible on my house.IMO with rates as low as they are,why save and put down a large chunk of change when borrowing is so cheap.I choose to use my money on other things.The mortgage interest is deductable anyway.15 yr 5.5% 1485 a month.I say use that big down payment to pay off everything but the mortgage.

[timk49]

The Southern California housing market is so hot home prices have sky rocketed. I was lucky to have had the chance to buy the home I'm in 5 years ago when prices were much lower. If things were different I's not purchase a house now. I'd wait till the market adjusts down again. It's the old buy low and sell high theory. I have seen this kind of market before. in the 80's houses were selling like hotcakes and it drove the prices way up. Then the resession of the 90's came and those same houses lost 30 to 40 percent of their value because there were no qualified buyers. I'd rent for a while and save the money so I have it for leverage when the prices finally fall. Of course there are always those fixer uppers that can still be a good deal if you provide the Sweat Equity.

[RyanbabZ71]

RENT??? Heck no ill live at home and have it good for a little longer They dont mind as long as I help out (cut grass and other stuff)

[bummed-n-Md]

Southern Cal's housing makert swings about every 7 years. I was one of those buyers in the mid - 80's in Southern Cal. Paid 118K (in '86) for a 1200sq-ft townhouse/condo. The same unit 6 months later was 135K. It hit an all time high (within a year) of $182K. In '91 ,when military orders transeferred me to the east coast, I sold it for 145K. When we sold, the market was just starting to fail/fall. (we started our listing at 169K but because we needed to sell fast and the unit next door to us was also selling we kept dropping our price. The funny (sad?) thing is this was happening everywhere. We only sold for 1K less than the comparables in the area. The same week we closed, in a 4 block area they all went for about the same price). A year after we moved out, the value on that unit was below $100K (friends in the old neighborhood told us it bottomed out in the mid to low $80s). We were extremely lucky to get in and out when we did: bought low, sold high (relatively).

 

If you plan on 'moving', get the maximium mortage you can, use their money not yours to build equity. (you also get the tax benifit) When you plan to finally settle down into a final location, then go for the smallest interest rate and smallest mortgage you can.