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Old 10-17-2009, 08:04 PM
cyo cyo started this thread
 
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My wife an I just made a bid on a home we live in little rock arkansas. We r working with a bank. We were informed th we would need 3.25% down. We are getting a FHA loan. Why do we need to put down any money?
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Old 10-17-2009, 09:15 PM
 
Location: Nashville, TN
1,177 posts, read 3,653,358 times
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Quote:
Originally Posted by cyo View Post
My wife an I just made a bid on a home we live in little rock arkansas. We r working with a bank. We were informed th we would need 3.25% down. We are getting a FHA loan. Why do we need to put down any money?
Because the bank wants you to have "some skin in the game" and shoulder some of the risk. The more skin one has in the transaction the less likely one is to just walk on their contractual obligation for any reason. Since it is the lender's money that you are borrowing they get to set the rules.
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Old 10-17-2009, 10:27 PM
 
9,807 posts, read 12,896,672 times
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Quote:
Originally Posted by cyo View Post
My wife an I just made a bid on a home we live in little rock arkansas. We r working with a bank. We were informed th we would need 3.25% down. We are getting a FHA loan. Why do we need to put down any money?

It was tried the other way ( no money down)

It didn't work !
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Old 10-18-2009, 07:05 AM
 
3,576 posts, read 5,902,769 times
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I hope the OP was kidding.

Seriously, there are people out there who think this way?

Financially, putting as little money down works towards the buyers advantage.

But there's this little mess we've been going through during the last 12 months. It's called the credit freeze.

Loan lending is tight. No one trusts anyone. You have to prove yourself to the banks. That means putting some money down. If things go sour, they are left holding the bag (the house) and you are free to walk away with a credit ding but you have nothing to lose financially if you put nothing down.

The financial lending landscape has forever been changed with the housing crash/credit freeze.

But that sad thing is that's the way it should have been to began with. Credit worthy borrowers have always been out there. It's just the past 6-7 years, the lenders because very loose in their credit requirements and lent to people they shouldn't have.
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Old 10-19-2009, 12:00 PM
 
264 posts, read 849,059 times
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If you have to ask this, maybe you shouldn't be buying a house in the first place... 3.25% is not much to be putting down any way (it isn't enough imho).
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Old 10-19-2009, 03:00 PM
 
Location: Plano, Texas
1,676 posts, read 6,332,679 times
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Actually it is worse than you thought, you need 3.50% down. The only way to get 100% financing is through VA loans for veterans and USDA loans which are for homes being purchased in more rural areas.
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Old 10-19-2009, 03:56 PM
 
Location: Sacramento
2,568 posts, read 5,837,600 times
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Is this a troll post? Why does someone need to put money down? Because you are buying something!!!!!.
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Old 10-23-2009, 11:04 PM
 
129 posts, read 589,307 times
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why not just offer the person advice instead of posting such negative comments. Not everyone is familiar with the process of buying a home. This is a great opportunity to share your wisdom. Why are there so many mean people in this world?
Anyway, in this economy not only are homeowners foreclosing who put no money down, but also elderly people with health problems or increased taxes, people who lost their jobs but had put enough down ,,don't judge before knowing all the facts, live is not black or white.

good luck to the original poster.
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Old 10-23-2009, 11:51 PM
 
Location: Happy wherever I am - Florida now
3,359 posts, read 10,632,316 times
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From an economic standpoint if you sold the house tomorrow that you bought today for the same price you paid for it you'd already be upside unless you put down the same percentage for your downpayment (say 6%) that it would cost you for a broker to resell it.
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Old 10-24-2009, 09:30 AM
 
Location: Fairfield, CT
5,528 posts, read 8,184,647 times
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3.25% is a very low down payment. Lenders other than FHA generally require a lot more at this point, and they should. Ability to save enough to accumulate a down payment is a good indication of whether a person is financially ready for home ownership. Those unable to save a down payment are generally not ready for home ownership and a bad risk to the lender.
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