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My fiance and I have signed a contract on a new townhouse and with a few months until settlement, we are wondering if putting ~5% down, after closing costs, is even worth the money we will save on our mortgage. Should we do no money down and use all that we've saved to upgrade and furnish the home instead?

2007-03-13 12:08:20 · 8 answers · asked by Anonymous in Business & Finance Renting & Real Estate

8 answers

Wow, I cannot believe some of these ridiculous answers, even from people in the industry!

When you finance a home and put <5% down, you will pay a slightly higher interest rate. This difference may not be that significant, perhaps .375%, but you need to recognize that this is a universal fact.

So, having said that, putting at least 5% down will give you a lower interest rate on your mortgage, thus a lower payment. Of course, you will also be borrowing less.

The answer really depends on you. Would you rather have that 5% in your hands to purchase furniture, save, whatever OR would you rather have a lower payment?

Mortgages are not rocket science. "Do the math" and see what your payment would be zero down vs. your payment at 5% down. Then consider if having that money in your pocket is a better place than having a lower monthly payment.

2007-03-13 17:04:23 · answer #1 · answered by jason n 2 · 1 0

I have to respond to Jason...sorry Jason, but in a lot of cases the blended rate on an 80/20 ends up with a lower payment. I agree that right now anyone who can should put down a least 5%, especially with the way the market is right now and lenders backing out of approvals.
That said, be sure to shop the loan and find out the differences. My companies 95% 1 loan is not all that pretty.....our 80/20's had a much more attractive payment option. Notice I said HAD. :)
Good luck! It just takes time and research and a good loan officer to get you what you need.

2007-03-14 04:44:13 · answer #2 · answered by queenvwr 2 · 0 0

The mortgage underwriters are refusing to honor all mortgage requests for no money down mortgages at this time, and in fact want 5% to 10% down on all mortgages they approve. So if you got approved at 5%, dont mess with it.

My sister HAD a pre-approval for no money down, but the underwriters have been refusing to give her a mortgage for the past 6 months now. Now they want 10% down and are refusing to budge. Her house is built, complete with all the upgrades she wanted in it, but she cant move in. Dont get in the same refusal mess she is in now.

2007-03-13 12:13:43 · answer #3 · answered by MrKnowItAll 6 · 1 1

I additionally consider Robert. additionally a credit of 654 isn't good credit. while you're quite involved in procuring, perfect now may well be a good time to purchase a $75k abode in case you dont opt for to lease anymore. useful its no longer your dream abode, yet a minimum of you would be construction fairness. in case you reside for 2 or 3 years (unitl the industry rises back), do despite advancements choose achieved on the abode, you may desire to sell it and get your final expenditures and down charge out of it on a greater abode, or perhaps lease it out later and save it as an investment. Then sell it for what you opt for in 2 many years, the two college for the youngsters, or retirement for you.

2016-10-02 01:54:23 · answer #4 · answered by Anonymous · 0 0

Pretty sure that you must find many financial solution at= loandirectory.info-

RE As a first time home buyer & w/ only 5-10% to put down, is no money down the better way to go?

My fiance and I have signed a contract on a new townhouse and with a few months until settlement, we are wondering if putting ~5% down, after closing costs, is even worth the money we will save on our mortgage. Should we do no money down and use all that we've saved to upgrade and furnish the home instead?

2014-09-03 13:51:55 · answer #5 · answered by Anonymous · 0 0

No, it is always better to put money down. Contact Carl Jarnberg at Direct Mortgage Funders, Inc. at 818-530-2185.Website: www.dmfund.com.

2007-03-13 13:15:36 · answer #6 · answered by cj23 1 · 0 2

1. Request a 6% seller concession upon making the contract with the seller for closing costs...

Example:
Home selling for 200K
Seller contributes 6% of 200K for closing = $12,000

$12,000 will be more than enough for closing and taking care of necessary costs. Thus, giving you no money down or out of pocket expenses...

Free Applications and 100% financing available at:

www.FinanceYourWay.com

2007-03-13 12:20:35 · answer #7 · answered by Anonymous · 0 3

It is all about interest. 0 down usually has higher interest, meaning more paid in over years. ask your mort. co what the pymt / interest is w/ 5% and w/o,,, u may be suprised!

2007-03-13 12:16:42 · answer #8 · answered by Anonymous · 1 0

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