first time help: First time home buyer mortgage help. - Help.com

Most banks want a 20% down payment - so at 70K your talking a 14K down payment. This is different than closing costs, closing costs are the payments you make for the services you get in the processes of closing a loan and buying a home (for example appraisal fees, title fees and ect).

Im wondering if you are confusing some of the concepts? a 3K down payment (or 4% down payment for a 70K loan) is supper low and I would question why the bank would give you such a loan and what are they hiding from your or pushing into the remainder of the lone.

7K closing costs sounds reasonable for closing costs;

but what I am wondering is if the down payment is really 10K (a more reasonable down payment on a 70K loan) where in 3K is due upfront and 7K due at closing … and your closing costs (which is a different amount all together) is being bundled into your mortgage (which is fine and not shady).

As a Canadian, minimum downpayments (by law) are 10% of the purchase price. I don’t know what the laws are down there.

As a financial advisor: what you are doing is extremely unwise. Purchasing a home with only $5K down is not a good idea. Everyone seems to think that real estate is a bullet-proof investment. It’s not. You yourself said the market is terrible.

A stock, bond, or mutual fund can be sold within 3 days at any time at the current market value. That’s because they have an important quality for an investment: liquidity (the ability to convert to cash). Real estate does not have that quality.

To be clear: if you need a house because your family is growing and you’re looking at either renting a family-sized apartment for $800/mo, or buying a home and ending up with a mortgage payment of $750/mo, then it *can* make sense to buy rather than rent (depending on the stability of your cash flow, your ability to pay down the mortgage quickly, and your skill at budgeting).

But if you’re buying because houses are cheap and you think it’ll be a bullet-proof investment, then DO NOT PROCEED unless you can front at least 25% of the purchase price with your own money. The previous owner of that house thought he couldn’t lose on that house either. Look where he is.

Buying a home, at the end of the day, is a lifestyle decision first, and a financial decision second. Can you afford the lifestyle that being a homeowner entails?

You might want to consider a USDA home loan.You can need very little down and very easy to qualify.

Thanks Brigitte Grisanti

A lot of the banks only want 3.5% as a down payment, which I can do, but the closing costs is what gets me.

Im not buying the house as an investment property im buying it to live in, im tired of paying overpriced rent for something that I will never own, and I dont think the prices can go much lower then they have (these 60-70k houses/foreclosures went for 150+ a couple years ago, and ive found some decent ones as low as 30k)

people swarm these houses the instant they hit the market and at this rate I cant see the prices staying this low for much more then a year, which is why I want to get in on it before they cost 150k again, so im trying to see if its possible or if I need to try and come up with another 10k cash

Are USDA loans not just for farm houses?

thanks for the replies

amvanc wrote:
A lot of the banks only want 3.5% as a down payment, which I can do, but the closing costs is what gets me.

Im not buying the house as an investment property im buying it to live in, im tired of paying overpriced rent for something that I will never own, and I dont think the prices can go much lower then they have (these 60-70k houses/foreclosures went for 150+ a couple years ago, and ive found some decent ones as low as 30k)

people swarm these houses the instant they hit the market and at this rate I cant see the prices staying this low for much more then a year, which is why I want to get in on it before they cost 150k again, so im trying to see if its possible or if I need to try and come up with another 10k cash

Are USDA loans not just for farm houses?

thanks for the replies

I would be very sceptical of any bank that wants only 3.5% down; even in the hight of the housing bubble when banks bent over backwards to hand out lones a good loan still requeed at least a 10% down payment and that still involved PMI.

At 3.5% your getting a jumbo loan … and paying for it one way or another.

If you’re looking for a home loan in California, try http://www.findmyloanonline.com