Trying to look for a house without a downpayment, is this possible?

[TheotherMarie]

You should look into a USDA home loan. A realtor should be able to refer you to a mortgage broker who deals with these.

The houses that qualify for these types of loans are generally on the outer edges of DFW area (think north of 380, for example), where building and development have only recently begun.

You will still need a certain amount of money in the bank, and in some cases be able to pay your own closing costs (some builders will pay these for you).
You will also have to meet certain income criteria, meaning you have to make enough -- but not too much.

A mortgage broker who deals with these types of loans can explain it to you, and tell you if you qualify.

[gocubs418]

Wait a minute.... I thought buying a house with 0% downpayment and a picket fence was the Dallas Dream..... errr American Dream?

Along with a couple new leased Tahoes, few vacations yearly, 3% contribution to 401k, and credit card debt?

I would love to see some statistics on percent of people who put 0-5%,5-10%,10-15%, and 15-20% down by age bracket. Give me income to home value as well.

Granted the DFW area seems to be middle aged 35-40, Most milennials are going to be in for a big hurt when they decided to live here.

[TheOverdog]

DFW percent of millennials is actually pretty low - Dallas itself generally leads, but the suburbs basically have 18year olds and then a gap that closes at late 20s. That's actually an age group DFW is trying to court a bit more.

Here are some charts from 2014 - Texas data doesn't appear for some reason, but it's easy to guess given the general trends. They use 'average down payment' which is heavily skewed by the wealthy, but it's the best you get. In short, down payments have been falling, and 3% less are very common, and down payments are pretty clearly linked to income.

No to low down payment purchases made up around 25% of home purchases in 1Q 2015. The average FHA down payment is $8,000, the average conventional is $75,000. Medians would be much lower because the averages are most assuredly skewed by wealthy putting down tons of money on expensive houses.

Average Home Down Payment in U.S. Dips to 3-Year Low - WORLD PROPERTY JOURNAL Global News Center
RealtyTrac: What was the average downpayment in 2014? | 2015-03-17 | HousingWire
Frequency of 3% Down Payment in 2014

[bencronin04]

Originally Posted by gocubs418

I would love to see some statistics on percent of people who put 0-5%,5-10%,10-15%, and 15-20% down by age bracket. Give me income to home value as well.

I don't have stats but for us:

26/29 years old.
22% down.
Yearly income is 43% of purchase price of our home.

I think a lot of the millennials in my generation are very apprehensive about home buying after seeing what happened right after coming out of college with the housing crisis and massive amounts of student loan debts. Are there still thousands that want to put down the minimum 3% FHA on a house out in Anna because it's new and shiny, while they can barely afford the payments....sure. But I think with the government regulations put in place after 2008, it has really shored up a lot of issues in regards to people getting into loans there is no way they can sustain. I tend to see the individuals in my age bracket that live beyond their means living in uptown or way out north of 380. Trying to be fake rich with leased vehicles and new 3500sqft houses that are an hour from their place of employment. But...to each their own.

[Aceraceae]

31/29
5%
Income is 65% of purchase value.
Melissa-we work in McKinney and Plano.

We pay two "mortgages" with student loans included.

[KathrynAragon]

54/57
20 percent down
Income is at least 80 percent of the purchase price of the home.

We bought a home that was half the price we were approved for, so even though we only put 20 percent down, we are still way below our maximum debt to income level - WAY below. But we should be. Since we are planning on retiring in 8-10 years we need to have our house paid off by then. So far so good. We are about to pay off two vehicles (within the next month) and will pay those amounts toward our mortgage, which should really knock it down quickly too.

I feel good about it. Normally we put down more than 20 percent but we found a heck of a deal on this house right at tax time and we had to send the IRS a chunk of money while also trying to buy a house. So it was bad timing. But at least we got a super low interest rate and a great deal on a house.

[gocubs418]

Thanks for the stats. Interesting piece.

[platon20]

Originally Posted by TheotherMarie

You should look into a USDA home loan. A realtor should be able to refer you to a mortgage broker who deals with these.

The houses that qualify for these types of loans are generally on the outer edges of DFW area (think north of 380, for example), where building and development have only recently begun.

You will still need a certain amount of money in the bank, and in some cases be able to pay your own closing costs (some builders will pay these for you).
You will also have to meet certain income criteria, meaning you have to make enough -- but not too much.

A mortgage broker who deals with these types of loans can explain it to you, and tell you if you qualify.

I find it hard to believe that communities north of 380 such as Prosper or Celina are considered "rural" status for USDA home loans. That might be true WAY north of 380 in places like Gunter but I doubt that places barely north of 380 like Prosper would apply

[bencronin04]

Originally Posted by platon20

I find it hard to believe that communities north of 380 such as Prosper or Celina are considered "rural" status for USDA home loans. That might be true WAY north of 380 in places like Gunter but I doubt that places barely north of 380 like Prosper would apply

Well, you'd be wrong.

[turf3]

The laws of finance, like the laws of physics, don't really change.

The rule of thumb used to be: 1/3 of reliable gross income max payment; 20% down. This ensures that the mortgage company covers their expenses if you default, and provides reasonable assurance that you have cushion to cover unanticipated expenses or temporary loss of income.

The further away from this you get, the more likely you are to run into problems.

Remember, mortgage companies do not care about your well-being. They will make you pay PMI if your down payment is insufficient, which is simply a way of making sure they don't lose money. If you lose a job, or have unplanned expenses, the house payment will still be due like clockwork every month. People will try to blow smoke at you to distract you from these basics, but the basics will still exist.

Cut all your unnecessary expenses and start saving like crazy for a down payment.