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Hi City-Data. Long time lurker, first time poster. I work for a Government Agency in NYC and have been in the same field for ~15 years. Post-Grad (Two Masters Degrees) Stable job, close to six figure salary (will hit that mark soon), working towards a promotion, never married, no kids.
I've noticed in conversation with some of my co-workers and people in my social circle that many of them have bought homes throughout the five boroughs with down payments way below the recommended 20%. For example, one of my colleagues purchased a multi-family home in the Tremont area of the Bronx with $55K down (he claims the home was $425K). Another in Woodhaven, Queens (SFH) for $35K down ($650K home), and another in South Ozone Park (SFH) for $24K down ($425K home).
Some of them have mentioned taking advantage of FHA and other methods (which they didn't discuss) and are telling me to get into the market now. I have close to $90K saved, but feel like I need to get over that $100K mark before I consider making any moves as I know 20% is that magic number. Most of the homes I'm interested in are in the $450-$600K range. I'm looking to stay in my native Queens, most likely in the Queens Village/Cambria Heights section (frequent LIRR service for shorter travel times to Manhattan and Brooklyn (gotta love that City Ticket!), not far from the train, highways, etc). Though I've looked at Woodhaven, Oakland Gardens and Kew Gardens, realistically, I doubt I could afford a single family home or multifamily in those areas. (Alternatively, White Plains looks amazing for the money, but... taxes!!).
Forgive my rambling. Looking through Trulia and Zillow, I see an unbelievable amount of foreclosures through Queens in all areas and I'm betting a lot of it has to do with people putting less than 20% down and not being able to keep up. When I was in Grad School, a lot of my peers would talk about getting a multifamily in order to have passive income and that being the only way to achieve real wealth (property/future inheritance) in NYC.
I am financially responsible, have good credit (on track to having amazing credit) and though the economy is rebounding, I'm always thinking about the worst possible scenarios (i.e. losing a job, market crashes).
How many of you have bought homes, condos or co-ops for less than 20%. Any advice for a guy in his mid 30s?
what are you worried about?
Stop acting scared. As long as you put down over 20% you're good, who cares what the next man is putting down. Put down as much as you can, thats it.
Happy New Year
__________________
"The man who sleeps on the floor, can never fall out of bed." -Martin Lawrence
Maybe is time for you to look someone and consider marriage. Is really hard to do it by yourself, especially with purchasing a house.
And have someone walk away with half or all of my investment the moment they are no longer happy? No thanks. I know too many divorcees sleeping on their mother's couch or in a studio apartment with several roomates.
And have someone walk away with half or all of my investment the moment they are no longer happy? No thanks. I know too many divorcees sleeping on their mother's couch or in a studio apartment with several roomates.
An FHA mortgage allows you to put down as little as 3.5%. The downside you have to pay mortgage insurance every month with is expensive as hell.
Nailed it.
NYC has no shortage of high income earners. Rather than wait years to accumulate wealth some will choose to buy now using a low down payment. The mortgage insurance may be expensive but the flip side is home prices could be higher if the buyer waits.
the foreclosures online might not be real, real estate sites are a joke streeteasy is the most accurate. You will need at least $5-10k in addition to the downpayment closing fees etc. You have close to 100k which is good, it means you can actually get a mortgage for something. Most people don't realize 50k isn't enough you need money for inspections, paperwork, attorney fees.
Your buddies might also have some crazy loans, as in the mortgages are older loans, or loans that are bad deals in which they are unfamiliar with the terms. They could have high mortgages and aren't paying any of the principal and are basically only going to be alright if the property sells for more than the purchase price (consider you have to pay taxes on the sale etc).
Ask your work buddies to hook you up with their specific loan rep/broker and see what that person can do for you before really starting to look. Looking online can be a waste- call the real estate agent when your ready be sure the properties are still for sale and aren't scammers looking for clients, desperate agents list properties that don't exist to get leads from the calls coming in.
I've looked in to financing multi family homes, major banks don't finance on these multi family properties the way they used to, maybe if you're in a union you can get something to available to the public. Traditional banks want higher down payments and do not use income potential for carrying costs anymore. Coops usually need 20% down, plus reserve funds.
And have someone walk away with half or all of my investment the moment they are no longer happy? No thanks. I know too many divorcees sleeping on their mother's couch or in a studio apartment with several roomates.
Agree with you on that, but that's part of life. Back in the old day, couple simply stick together. Now, any disagreement between a couple simply end up with divorce. Where are we really heading to as a society? It appears that most people goal in life is to dig for as many dollar as possible. Is sad, but is so true. I am not saying you are one of those people, I am simply pointing out the pathetic life most people have nowadays. Bottom line, I understand your concern. However, I am not sure if being alone is ever a good idea. Sometime we have to take a leap at faith. If human can stand being alone, then the society would not be established with mostly in term of a family.
Stop acting scared. As long as you put down over 20% you're good, who cares what the next man is putting down. Put down as much as you can, thats it.
Happy New Year
I think OP is more concern about the fact if he/she unable to keep up with the mortgage payment and any other expenses related to a house, and that would mean all the money OP put down is down to the toilet with no way back. It seems like OP just need assurance.
I think OP is more concern about the fact if he/she unable to keep up with the mortgage payment and any other expenses related to a house, and that would mean all the money OP put down is down to the toilet with no way back. It seems like OP just need assurance.
Agree with you on that, but that's part of life. Back in the old day, couple simply stick together. Now, any disagreement between a couple simply end up with divorce. Where are we really heading to as a society? It appears that most people goal in life is to dig for as many dollar as possible. Is sad, but is so true. I am not saying you are one of those people, I am simply pointing out the pathetic life most people have nowadays. Bottom line, I understand your concern. However, I am not sure if being alone is ever a good idea. Sometime we have to take a leap at faith. If human can stand being alone, then the society would not be established with mostly in term of a family.
Better safe than sorry. It's one thing to read studies (which match my anecdotes), but I know too men throughout the income/career spectrum who received the short end of the stick when it came to divorce. Many of them are good men.
And have someone walk away with half or all of my investment the moment they are no longer happy? No thanks. I know too many divorcees sleeping on their mother's couch or in a studio apartment with several roomates.
Quote:
Originally Posted by BugsyPal
Amen to that!
You are preaching to the choir.
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