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First house purchased in 1991. I couldn't qualify for a mortgage for as much money as I wanted, so I borrowed ten grand from my father and bought a house with an assumable FHA mortgage. No credit check from the lender or the owners. They just got a check for the difference between their mortgage balance and the agreed sales price (which was much lower than it should have been because they and their realtor didn't understand how valuable that assumable mortgage was at that time.)
Closing took ten minutes and less documents than it takes to buy a car.
Every home after that had a minimum of 20% down, usually more.
When we bought our first house it was just before people went insane with real estate (that led to the bust). I'm pretty sure we did not put 20% down, because I don't think we had that -- probably 5 or 10%, I really don't remember. Since then, though, we've been able to put 20% down, partially from appreciation on our previous house.
It's hard for a lot of young people, especially if they have student loans, to put 20% down (although there are advantages, like no PMI and in many states, being allowed to not maintain an escrow for taxes and insurance if you so desire). In the early 2000s, mortgage lenders completely lost their minds, leading to a free-for-all for borrowers, who could purchase even with no money down and no proof of income, employment, or savings. While back in the 60s and 70s, you simply had to put 20% down, as there was no other choice. As housing prices started climbing, this got more difficult and there were a lot of programs that arose, especially for first time buyers, to not have to put as much money down. I think this was a good thing, although with the insanity in the mortgage market, this also led to some problems (although I think other issues led to more of those problems). I don't know, post mortgage-meltdown, how much the 20% rule has come back.
With some of the insane prices of real estate in some areas, coupled with crippling student loans and still somewhat-shaky job market, I am not surprised that a significant number of younger people would be simply unable to produce about $40-$60K in cash (or more). Many can't come up with even half or a quarter of that, which is why you see so many adults living with their parents. Plenty of other folks are paying rents that are as much or more than they'd be paying on a mortgage, but can't come up with an initial payment, let alone one as high as 20%.
So, while I think it's great to do it if you can, I understand that many people cannot.
I used a first time buyer program in my state. I can't remember whether it ended up being 3% or 5% - I had the higher amount, but I think they ended up putting through the loan with the smaller amount. I had cash beyond that, which was helpful for moving expenses and buying new furniture and other things for the new house.
I would not have bought at that point in time without that program, but since it was available, I took advantage of it. Unlike FHA, there was no mortgage insurance - the way it worked is that I would have had to pay back a certain percent of any profit if I sold within X number of years (can't remember if it was 5 or 7, but something in that range). They didn't want people using the program to buy with low money down and then flip, but once you owned for a certain amount of time, the repayment obligation dropped off. I also got what was at the time a very attractive mortgage rate of 7.825% - that was actually a fair amount below market at that point.
I put down less than 20% many years ago, but would never do that again, nor would I consider selling to someone who could not put 20% down and pay all their own closing costs to buy my house.
Late 1980's--used FHA. Fairly fresh out of graduate school with lots of student loans. Our mortgage was about 10% interest at the time as I recall. The graduate school paid off pretty quickly in terms of our income, and we bought a bigger house a few years later with 20% down. Prior to the second house we refinanced--probably less than 20% down, but it was a 15 year loan so we were paying more of the principal and less interest fairly quickly. It was pretty cool to see the entire loan principal go down every month in our payment book.
I put down exactly 20% for my first house. I think it's better to save up some money rather than put down a really small down payment and take more debt. Inability to save for a down payment is a good indication that a person is not a good candidate for home ownership. And weak lending standards that allow such low down payments inflate housing prices, making the affordability/foreclosure problem worse.
Like a couple of the others: 0% down, VA loan. It was very helpful in a high cost market like San Diego.
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