mortgage down payment levels

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workerbeeengineer
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Joined: Thu Jun 02, 2016 12:22 am

mortgage down payment levels

Postby workerbeeengineer » Thu May 18, 2017 11:49 pm

Just read that B of A is proposing 10% (versus 20%) down payment levels. How long until we are back to no income no job no assets (NINJA) loans? Time to start shorting bank stocks?

alfaspider
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Re: mortgage down payment levels

Postby alfaspider » Fri May 19, 2017 10:12 am

I think 10% down payment loans are a far cry from NINJA loans. 10% downpayments have been available for some time with the requirement for either PMA or a piggyback loan. Some banks even offered me 10% down with no PMA or piggieback when I bought my house in 2013, but interest rate was higher. FHA and VA loans are still offered with 3.5% down.

runner540
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Re: mortgage down payment levels

Postby runner540 » Fri May 19, 2017 10:20 am

20% is standard only for BH. According to the American Enterprise Institute's Housing Risk research, the median down payment is 5% for all home loans. Repeat buyers (not first time) have median down payments of only 10%.

AEI has lots of fascinating data on home loans. You can dive into it and see trends on Debt to income, credit scores, etc.

(page 59 in slide deck) http://www.housingrisk.org/mortgage-ris ... 2016-data/

danielnash
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Joined: Tue Sep 27, 2016 9:10 am

Re: mortgage down payment levels

Postby danielnash » Fri May 19, 2017 10:23 am

Most mortgage companies will happily give you a mortgage with as little as 3.5% down. Anything under 20% and you will have to buy PMI but the only thing that has changed from pre-financial crisis is that mortgage companies actually need documentation showing you can afford your mortgage.

You should go to BofA and see how much mortgage you would qualify for...it's crazy how much they will give you versus what you should be given.

If you are a military veteran, the VA offers 0% down.

:sharebeer

sls239
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Re: mortgage down payment levels

Postby sls239 » Fri May 19, 2017 10:25 am

I think that is just a response to the changes in PMI with FHA loans. That 11 years of PMI for having a 10% down-payment just invites banks to offer an alternative - a slightly higher rate but no PMI is my guess.

smitcat
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Re: mortgage down payment levels

Postby smitcat » Fri May 19, 2017 12:37 pm

The no income check mortgages are already back.

Admiral
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Re: mortgage down payment levels

Postby Admiral » Fri May 19, 2017 1:02 pm

smitcat wrote:The no income check mortgages are already back.


This has not been my experience, at least with a refi in August 2016. Documentations requirements appeared to be much more strict versus my last refi, which was in 2011. We have 800+ credit ratings and STILL needed to provide pay stubs, two years of tax returns, bank and brokerage statements, you name it. It was a PITA. And, again, this was a REFI not a new loan.

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Re: mortgage down payment levels

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