My fiancee and I are probably going to start looking into houses in the spring. In the mean time we’ll be tossing money into our savings account for a down payment. We’re probably looking to stay under 100K for a house and maybe around 70-80k. I’d like to get something that needs a bit of work but not falling over.
Anyway, can anyone give me a estimate on what I’m going to need up front? I was thinking at least 5k would give me a decent mortgage. I know it all depends on the cost of the house, APR, the way the wind blows, etc. Just looking ball park what some of you guys put down.
If you have until spring do the first home club. Free money for you.
And to answer the other part, its not necessary but I put 20% down. Didn’t want to deal with PMI.
I needed around 12k from the time I started looking until the key was in my hand. I financed 30 conv 100% on 112k at 6.25%. That said, the money went into closing costs, survey, title insurance, broker fee, etc… not one dime was part of the down payment. Was there a smarter way to do it, probably. But, I budgeted my mortgage about 30 times before I priced up a house.
I am getting my mortgage through them as have a couple of people on this board. It is legit. MY application just went out to the underwriter today, and we foresee no issues with a 110K approval. The process is a bit demanding on the paperwork side but if you keep good records are are diligent in responding to requests you will have a smooth and fast experience.
As for cost, for the NACA program we only NEED to have first year taxes and insurance which is ~4,000. We are giving them more though.
Alright here is my primary concern, If I only have say…5k is that enough to get me keys to a house (in the aforementioned price range)? Obviously I’d like to have a ton more but I’m unsure on what I can come up with by March/April.
I’m not sure if you still can, but it used to be possible to roll the closing costs into the mortgage. Might be something to have in your back pocket in case you come up a bit short. Do it that way and then throw a $5k payment at the mortgage after the dust settles.
Bingo, or when bidding on a house ask the seller to cover all closing costs. Use that as a bargaining chip rather then coming down on the price of the house so much. Essentially you’ll be rolling closing costs into your mortgage, but it doesn’t look that way to the bank.
I’ve heard that and I’m not sure how it works. IIRC the bank charges a higher interest rate until the closing costs are paid. I’m not sure though. I went apartment looking and for anything reasonably sized it was like $850. It makes so much more sense in my mind to have a mortgage + utilities + taxes,etc. and come out (hopefully) around the same price. My fiancee does MaryKay stuff and I do computer side work, and have guitars, amps, drums and shit that would not be possible to have without a house.
<EDIT>
Is that combined income? Even still we should be fine.
my “opinion” is that if you have to scrape together to come up with $5K for a downpayment over several months… what is the bank’s view on what you can actually afford for a monthly payment and what is your credit history. down payment is one thing…ability to pay (in the eyes of the bank) for the next 15-30 years is another.
It is combined. Is your side work on the books? If not, would help your eligibility for the program but would hurt your eligibility to actually get a mortgage.
My credit score is very good and with all my bills I don’t think I’ve ever missed a payment. Obviously I’d love to have around 10k to toss at a house, but I haven’t been saving as much as a I should and I just put $3,000 down for my car. I also got my student loans reduced by about half. If I have to wait to buy a house I guess I can, but I want to shoot for the spring.
<EDIT>
My sidework isn’t on the books, it’s mostly fixing family and friends PCs, and doing some website work (personal use). My fiancee’s Mary Kay stuff is on the books I guess, as it is taxed and whatnot.
Yeah, do some sort of first time homebuyer program. You sound like the person they’re meant for. (Good credit, just short on the DP)
In the meantime, if you want to help your eligibility some sort of full time position would help immensely
I’m employed full time ATM. I’ll be at my current job for 1 year on November 2nd. I was layed off In January of 2009 and got my current job that November. Aside from my down-time between Jan. and Nov. (I was also in college during this period), I have no other gaps in my employment history since I was a paperboy 10 years ago.
sellers assist always helps with closing costs, I’m in the middle of purchasing a house around 130,000 and all we needed was 4,000 down but thats because the sellers paid the other half of the fees
its crazy all the fee’s you get charged just to buy a house, i know my fee’s were almost 10,000 alone, and thats not including any money towards the house!!!
when i was applying for my mortgage salary history was important and anything shy of 2years was ignored for the most part. My one business that does extrememly well is under 2yrs old and wasn’t taken into much consideration for contributing to my total earned salary. Job history isn’t really in your favor either in the banks eye.
When I bought my house literally 2 months after graduating college…I had not much in savings. I went with an 80/20 to get me into the house…mortgage on 80% of the house value @ 5.375%, with the remaining 20% being on a line of credit which started at ~5% and fluctuated with the market. Did this to avoid PMI and to get around no down payment. The savings I did have went into the first round of shit to take care of that didn’t come with the house (laundry, kitchen appliances, etc.)
Best way to go about it? Debatable…but at the time it was my best option and I really haven’t seen any negatives.
Just a FYI to all it is possible to “roll closing costs in” or at least most of them. This referred to as a sellers concession. Say you buy a house at 80k agreed price but want help with the closing costs, you can take a concessions provided the seller agrees (which almost everyone uses this a lot) and buy the house at a higher value, the assessment of the house has to hold up obviously.
This is the most common way as “in the longe run” you pay the least amount of interest. When I applied for my mortgage it made sense, for me, to do 100% finance. I did not care about interest as I went based on what I could afford. As already pointed out.
I would weigh your options. Are you going to need your downpayment to make your house livable? Or, use for security in the event you need to fix something?
