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Old 01-24-2012, 11:26 AM
 
3 posts, read 3,101 times
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[SIZE=4]Hi, My family and I have moved to Western PA recently and are renting an affordable townhome in hopes of saving up enough to put down on a home soon. I am looking at my options as far as mortgage rates and how lenient are the loan offers to those of us who want to buy but fall short of a 20% down on the house. I am willing to wait till I can save up 20% solely because I want a very affordable monthly payment on my home. We intend to grow old in this home we buy so not wanting to cheap out on a first time buy etc. Does anyone know if we can get a home loan with a decent interest rate even though we don't have 20% to put down? Or should we wait it out and buy only after saving up the 20%. I ahve found my dream home and really don't want it slipping away but I dont want to be foolish by jumping when not ready more.... please help me![/SIZE]
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Old 01-24-2012, 11:43 AM
 
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Your monthly payment is going to be considerably lower with 20% down. But if you are close but not at 20%, and are really stuck on this particular home, you could potentially buy it now with the best terms you can find, then refinance down the road when you had 20% equity (note: given this plan you probably would not want to pay any points). Of course that plan depends on various assumptions about rates and appreciation, and there would be some additional transaction costs to do that, so you would want to be OK with your initial mortgage if it ended up being a bad idea to refinance it down the road.
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Old 01-24-2012, 12:50 PM
 
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Not sure if this is viable anymore and don't remember the exact details but a friend took out a second mortgage or LOC right after getting his initial loan. He used that to put a large sum on mortgage 1 to get him over 20% which then dropped the PMI.
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Old 01-24-2012, 04:21 PM
 
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Thank you very much I will look into it.
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Old 01-24-2012, 08:07 PM
 
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If you happen to be buying in the City of Pittsburgh, the URA may be able to help you out. They don't offer stellar loan rates, but if you meet the requirements you can qualify for down payment assistance, property tax abatements, and home improvement funding. Check out their site here: Urban Redevelopment Authority
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