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Old 08-10-2010, 09:05 AM
 
Location: Lending in all 50 states
186 posts, read 664,513 times
Reputation: 109

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Quote:
Originally Posted by Citron View Post
I am looking at either buying a Townhome or condo unit in the area I live in as an investment. Recently I went to BoA and they had said I needed a minimum of 30% down. Is this the norm nowadays? I plan on visiting other banks and lenders but figured I'd ask here too. I am close to the 30% down but I'd rather spend some of the money on fixing it up before renting it out.
Hi Citron,

It will depend on a couple of things that have already been pointed out, things like property type (condo) and location. If you're buying in a soft market, the lender may require more down based on the severity of the declining market designation. For example: I had client buy an investment property in Reno, NV. One lender wanted 25% down because of the soft market status while the other only required 20%.

The other option that has not been mentioned is the HomePath Program.
Some of the benefits of the program.
1) Only requires 10% down on investment properties.
2) Does not require mortgage insurance.
3) No appraisal required.

The down side to the program.
1) Limited choices, the home must be a Fannie Mae owned REO
2) The rate will be higher than a traditional 20-25% down Fannie/Freddie mortgage.

If cash flow and reserves are important to you, the HomePath Program maybe a better option for you.

Good Luck
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Old 08-12-2010, 10:07 AM
 
Location: Marion, IA
2,796 posts, read 5,068,807 times
Reputation: 1567
30% seems really high. Even for a condo. I had to put 25% down on a 4 plex that I was NOT going to live in, but I got a great interest rate. Usually if you live in the place you can get away with a smaller down payment. Shop around for better deals than 30%. Sheesh.
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