Comments on: Down Payment Assistance Backdoor to No Money Down? Seller-funded Down Payment Scams. The Government looking to resurrect No Money Down Loans.

By: fatherpain

fatherpain — Tue, 10 Mar 2009 03:32:40 +0000

DrHB,
How much do you think the bubble will be deflated 2 years from now?
Keep up the great work!
Tom

By: Mortgage Man

Mortgage Man — Tue, 10 Mar 2009 01:13:39 +0000

I agree that this is not the same thing as the subprime and Alt A fiasco. FHA does require the customers to fully document their incomes and typically stay with a 29/41 housing/debt ratios. The old program was abused by the lenders and the builders but there were a lot of people that benefitted from that program. My first loan was a VA loan with no money down. I am now on my 3rd home and have $32,000 left on a $270,000 home. It comes down to personal responsibility and with the amount of inventory that is stacking up, it may actually help. A realtor charges a 6% commission. Does that the home is worth 6% less if you buy from a realtor instead of a FSBO?

By: Sabin Figaro

Sabin Figaro — Tue, 10 Mar 2009 00:06:53 +0000

@ Koko
Interesting that the one Republican was from California–imagine that.

There must be a god because we as a species are too stupid to survive by our own wits…

By: Sabin Figaro

Sabin Figaro — Tue, 10 Mar 2009 00:04:08 +0000

Doc,

The rental thing makes so much sense. People are always moving to forward their careers and so forth. There is the foolish thought process that if you rent you are throwing your money away and if you buy it is an investment and you can live for free. It just ain’t so.

I used to sail a lot but never owned a boat. For a couple of hundred bucks, we could take a large boat out for the day, have fun, bring the boat back, get our deposit and drive home–none of the hassles of ownership, just the fun.

Some people buy time shares thinking that is an investment. I rented a house in Jamaica a couple of times shared with some great friends, had a ball, flew home. I didn’t have to pay for the maintenance, taxes, staff, all that. You just have fun and go home.

Buying a home is a giant commitment in a world with no guarantees. There’s no free lunch, but if you pony up a couple bucks, you can pay for a nice lunch. If you rent a house and save the difference, you can live the same way without the extra costs of ownership and buy something when you are ready. There is nothing worse than having to sell a house after you have moved to another state and are working hard to establish yourself in a new town at a new job. When you have to sell on a timetable, you often lose. Where’s the economy in that?

I know most of us hate to think, but it’s a good idea.

By: js

js — Mon, 09 Mar 2009 21:43:59 +0000

“We have many qualified buyers who make the income and have good credit, but with the cost of living as it is, cannot save enough for a down payment.”

Wait a second. Won’t the monthly cost of a home EXCEED what these people are presumably paying now to rent a home/apartment? But these people live so close to the edge they can’t save anything for a down payment now? Or is it just that they can’t save 20% of say 500k , which is 100 grand. Ok, fair enough, it’s nearly impossible for most people earning average incomes to save that (especially after taxes). No argument there. But most people earning average incomes are in no position to buy a 500k house either! They couldn’t make the monthly nut on a traditional mortgage on 500k. And what about all the costs of home ownership like repairs. Can people without a down payment really afford those?

At the end of the day there is no way around it, houses cost too much at present.