Paying 10% at the time of CONTRACT in NY State

[JustSayNo]

Good for you! and good luck with the move and your new home!

[new2you07]

Hello
I just went into contarct on a house I am putting 20% down-(60,000)
At contract I put 10 % of my down payment-($6,000)
All you have to do is put a percentage of your DP at contract
also a seller can't make you put down anything
if a bank lets you put down 5% and will finance the rest, that's it
If you get PRE-QUALIFIED for your mortgage, then you will have no problems

The only thing I heard in 4+ months of looking is certain sellers wanted people who were pre-qualified for a mortgage, because they had gone to contract with people who had pre-approval letter-(big difference) and then had their financing fall thru & so did the deals

I am not a lawyer, just someone who did a lot of homework
before & during the buying process, and I knew things the agents didn't know

Also money goes into escrow if the seller agrees to fix something & doesn't by the closing date or you close & they saty in the house after the close date
I didn't have to put a nickel into escrow

Hope this helps & good luck

[NooYowkur81]

Does anyone know for sure if the 10% thing applies to upstate NY as well. I am seriously considering purchasing a house for investment purposes in the Syracuse area. I really don't have that much money lying around like that, I'm only 25 and most of my savings right now are in retirement plans that I don't want to touch. I was hoping to do 100% financing and the property will hopefully pay for itself with rental income. I wasn't factoring in this whole 10% thing.

Good Thread by the way. Very informative.

[OvertaxedOnLI]

Originally Posted by Newtony

Thanks everyone for these insights, we will be putting down 20% or more when we buy the house and are aware of the tight market in westchester.

I was just surprised that the 10% down at contract was a requirements and not at the time of the actual closing.

And of course you may find in a tight market that the Seller, in evaluating competing bids, may well ask if you're willing to put an even larger percentage down at contract, even if you're an all-cash buyer. That happened to me when purchasing my current house. The field was narrowed to myself and two other potential buyers, and all three of us were all-cash and offering the same price for the house. The Seller made his decision based on who was willing/able to put the largest percentage down on contract; that turned out to be me, at 30%. The other two buyers only went up to 20% and 25% down.

[JustSayNo]

Oh Noo, take from an old person

First, DO NOT take any money out of your retirement accounts, AND keep on adding to them. At 25 it is very good of you to have a retirement account at all!! clap clap.

Second, DO NOT fall into the 100% finacing trap. I know it looks good, sounds good, but they are a boat load of trouble considering your future in not set in stone. None of us can tell what is going to happen tomorrow, and a 100% mortgage just adds to the "potential" for problems in the future. Ya, I know, lots of people do it, but really as this is an investment property and you are only 25 and we are in the middle of a tossing and turning housing market I just can't see how now is the only time you can do this.

I applaud your investment savy, your eye toward the future. I really do. But, I think that Upstate in the next 5 years you will see a lot of opportunity will remain. Instead of going all finance, maybe think of saving a bit every week, like you do for retirement, in a money market account and really scope out exactly what you can afford, where you want to buy, and what you want to buy.

As far as I know, 10% needs to come from somewhere, either you , the bank, or you and the bank!

Sorry to be a "Mother" but you have so much time ahead of you, you obviously know and do save, and I hate to see someone 100% finance when they really don't HAVE to. It just puts your azz in the wind more than you have to have it out in that wind!

Good luck!

[NooYowkur81]

Thanks for the advice JustSayNo. I'll definitely take it into consideration.