U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Real Estate > Mortgages
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 05-04-2018, 07:10 AM
 
842 posts, read 359,208 times
Reputation: 2102

Advertisements

Quote:
Originally Posted by Copanut View Post
But I think we can all agree, FHA is a good program!!! Whether or not you buy 1 or 100 houses.
No, it’s a pretty horrible program that allows homeowners who aren’t in a position to prudently own an asset to expose themselves to higher financial risk. Some people can do it, but being overleveraged or having a home with little equity and a high monthly payment IS risky. That’s without question. Some can manage it and not have financial difficulties move them into default, but others really end up hurt by that financial decision because their income wavers or drops, the market sinks for a bit, they have to move before equity has been gained, etc.
Reply With Quote Quick reply to this message

 
Old 05-04-2018, 07:16 AM
 
Location: Great White North Hills
10,916 posts, read 13,429,049 times
Reputation: 8190
Your opinion. I can name a lot of my buddies who took the same route I did, all you need is half a brain. Maybe that's the problem for those that fail.
Reply With Quote Quick reply to this message
 
Old 05-04-2018, 08:24 AM
 
10,196 posts, read 6,140,982 times
Reputation: 10673
Quote:
Originally Posted by Schmooky View Post
No, itís a pretty horrible program that allows homeowners who arenít in a position to prudently own an asset to expose themselves to higher financial risk. Some people can do it, but being overleveraged or having a home with little equity and a high monthly payment IS risky. Thatís without question. Some can manage it and not have financial difficulties move them into default, but others really end up hurt by that financial decision because their income wavers or drops, the market sinks for a bit, they have to move before equity has been gained, etc.
Those people would have failed with a conventional loan too. Now banks are offering competing products similar to FHA with 3% down but only mortgage insurance until you are at 20%.

Also it used to be that way, but now they are much stricter on who qualifies, and they are some of the safest loans that are resold to banks as a reliable investment.

So in no way is it a horrible program. It's an entry into home ownership instead of throwing the same or higher payment on rent.
Reply With Quote Quick reply to this message
 
Old 05-04-2018, 08:27 AM
 
244 posts, read 117,911 times
Reputation: 200
They jacked up the MIP rate after the crash. Why should the industry have to suffer for the mistakes they made? Better to just suck it out of consumers while the industry continues to cash in.
Reply With Quote Quick reply to this message
 
Old 05-04-2018, 08:35 AM
 
10,196 posts, read 6,140,982 times
Reputation: 10673
Quote:
Originally Posted by Grumpty View Post
They jacked up the MIP rate after the crash. Why should the industry have to suffer for the mistakes they made? Better to just suck it out of consumers while the industry continues to cash in.
yeah it was as high as 1.75% upfront and 1.35 yearly which is crazy, the good thing is rates went down and you could always try to refinance to a lower rate.
Reply With Quote Quick reply to this message
 
Old 05-04-2018, 11:54 AM
 
541 posts, read 199,350 times
Reputation: 582
I got my loan through my credit union and put down very little but have no PMI. If you search around there are products that don't require the mortgage insurance.
Reply With Quote Quick reply to this message
 
Old 05-04-2018, 12:40 PM
 
Location: Northern Virginia
4,510 posts, read 4,656,118 times
Reputation: 10339
I am grateful those programs exist.

When my husband and I bought our house 7 1/2 years ago, we didn't have sufficient money saved for a 20% down payment. We were not irresponsible with money - we just hadn't had the means and opportunities to save that amount of money. By using this program, we were able to purchase our house and still have money in savings to fund maintenance and any emergency repairs.

As I stated upthread, once we reached the 80/20 LTV ratio, we refinanced to drop the PMI and lower our payments. We plan to live in this house for years to come, but if we were to sell it now, there is more than sufficient equity to use as a down payment on our next house.

Even when our payment was at the higher interest rate and included the PMI, it was on par with rents for similar properties in my neighborhood. And once we refinanced, our mortgage payment is significantly lower than rents for similar properties.

I don't get why we're denigrated for using this program. While the balance of our mortgage is steadily decreasing, the market value of our house has increased, our salaries have increased, our savings has increased. We're sitting on a pretty healthy nest egg and continuing to watch it grow in part because of these no/low down payment programs.
Reply With Quote Quick reply to this message
 
Old 05-04-2018, 01:03 PM
 
10,196 posts, read 6,140,982 times
Reputation: 10673
Quote:
Originally Posted by HokieFan View Post
I am grateful those programs exist.

When my husband and I bought our house 7 1/2 years ago, we didn't have sufficient money saved for a 20% down payment. We were not irresponsible with money - we just hadn't had the means and opportunities to save that amount of money. By using this program, we were able to purchase our house and still have money in savings to fund maintenance and any emergency repairs.

As I stated upthread, once we reached the 80/20 LTV ratio, we refinanced to drop the PMI and lower our payments. We plan to live in this house for years to come, but if we were to sell it now, there is more than sufficient equity to use as a down payment on our next house.

Even when our payment was at the higher interest rate and included the PMI, it was on par with rents for similar properties in my neighborhood. And once we refinanced, our mortgage payment is significantly lower than rents for similar properties.

I don't get why we're denigrated for using this program. While the balance of our mortgage is steadily decreasing, the market value of our house has increased, our salaries have increased, our savings has increased. We're sitting on a pretty healthy nest egg and continuing to watch it grow in part because of these no/low down payment programs.
What upsets me the most is the people who say if you can't save up 20% you don't deserve to buy a house.
And not only do you need 20% you need closing costs and inspection and appraisal costs plus other miscellaneous costs
Reply With Quote Quick reply to this message
 
Old 05-04-2018, 03:06 PM
 
3,283 posts, read 7,124,985 times
Reputation: 4019
I buy rentals with hard money, and upon conventional refinance, my hard money lender increases the payoff by the amount of my down payment, and then we re-use that original down payment $$ toward the next deal. So I literally walk into them with net-zero down.

Yes, it's legal, but it's fun to make curmudgeons' heads spin.

Happy Cinco de Mayo!
Reply With Quote Quick reply to this message
 
Old 05-05-2018, 05:53 AM
 
1,022 posts, read 685,050 times
Reputation: 1953
Quote:
Originally Posted by LifeIsGood01 View Post
What upsets me the most is the people who say if you can't save up 20% you don't deserve to buy a house.
And not only do you need 20% you need closing costs and inspection and appraisal costs plus other miscellaneous costs
Home ownership is not a right; it is a privilege. To deserve that privilege takes planning, responsibility, and resources.
If you cannot put money down, you better have at least a years worth of living expenses saved, pristine credit, no other debt, and a stable job. Otherwise, I wouldnít loan you a dollar, let alone hundreds of thousands of dollars.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Real Estate > Mortgages
Follow City-Data.com founder on our Forum or

All times are GMT -6.

© 2005-2017, Advameg, Inc.

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top