Anonymous
Post 05/24/2016 08:39     Subject: Re:How common is it to put 5% down on a house?
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:In Q4 2015, FHA loans comprised about 23% of all purchase loans. Since there is little reason to get an FHA loan if you can swing a >=10% down payment, it is reasonable to assume that nearly all of these FHA loans had down payments of 5% or less.

Some additional percentage of all purchase loans are VA loans or loans in other programs that allow for low down payments.


I can't speak for FHA loans but I went with a VA loan with a 20% downpayment because it offered the best deal on a 30 year loan. I got a better rate than a 30 year loan and enough lender credits to cover all of the closing costs and VA funding fee.


That's a difference between FHA loans and VA loans. FHA loans are at the same rate that person would be eligible for with a conventional loan. So there's
almost no reason to do an FHA loan except to go below 20%.


I was only responding to the PP above that suggested the percentage of VA loans might be indicative of the number of people buying houses with low down payments.
Anonymous
Post 05/23/2016 22:28     Subject: How common is it to put 5% down on a house?
We just put down 3.5% FHA for our first home. I've been out of law shook for 4 years, and that's a mortgage in and of itself. We also had the option to put down 5% with no pmi, but I didn't want to completely empty our savings, and knew we needed furniture etc.. Worked out fine.
Anonymous
Post 05/23/2016 21:18     Subject: Re:How common is it to put 5% down on a house?
Anonymous wrote:
Anonymous wrote:In Q4 2015, FHA loans comprised about 23% of all purchase loans. Since there is little reason to get an FHA loan if you can swing a >=10% down payment, it is reasonable to assume that nearly all of these FHA loans had down payments of 5% or less.

Some additional percentage of all purchase loans are VA loans or loans in other programs that allow for low down payments.


I can't speak for FHA loans but I went with a VA loan with a 20% downpayment because it offered the best deal on a 30 year loan. I got a better rate than a 30 year loan and enough lender credits to cover all of the closing costs and VA funding fee.


That's a difference between FHA loans and VA loans. FHA loans are at the same rate that person would be eligible for with a conventional loan. So there's
almost no reason to do an FHA loan except to go below 20%.
Anonymous
Post 05/23/2016 20:44     Subject: How common is it to put 5% down on a house?
We put 5% down on our first house and 0 down on our second. Used the remainder both times for renovations. It worked out very well in both cases.
Anonymous
Post 05/23/2016 20:18     Subject: How common is it to put 5% down on a house?
Anonymous wrote:We did it; paid PMI for two years then refinanced.


We did this, but it took 4 years in our neighborhood to get to 78% (or was it 80%) LTV.
Anonymous
Post 05/23/2016 17:42     Subject: Re:How common is it to put 5% down on a house?
Anonymous wrote:In Q4 2015, FHA loans comprised about 23% of all purchase loans. Since there is little reason to get an FHA loan if you can swing a >=10% down payment, it is reasonable to assume that nearly all of these FHA loans had down payments of 5% or less.

Some additional percentage of all purchase loans are VA loans or loans in other programs that allow for low down payments.


I can't speak for FHA loans but I went with a VA loan with a 20% downpayment because it offered the best deal on a 30 year loan. I got a better rate than a 30 year loan and enough lender credits to cover all of the closing costs and VA funding fee.
Anonymous
Post 05/23/2016 17:14     Subject: How common is it to put 5% down on a house?
Anonymous wrote: I will be a first time home buyer and am struggling to save so I was just curious if this is a common thing.

It was pretty common before the housing bubble burst. I don't hear about it much recently.
Anonymous
Post 05/23/2016 17:12     Subject: Re:How common is it to put 5% down on a house?
Anonymous wrote:In Q4 2015, FHA loans comprised about 23% of all purchase loans. Since there is little reason to get an FHA loan if you can swing a >=10% down payment, it is reasonable to assume that nearly all of these FHA loans had down payments of 5% or less.

Some additional percentage of all purchase loans are VA loans or loans in other programs that allow for low down payments.


FHA loans are assumable and they are more lenient with regard to debt-to-income ratio and with credit scores. So there are several reasons to go FHA vs. conventional besides a low downpayment.
Anonymous
Post 05/23/2016 15:04     Subject: How common is it to put 5% down on a house?
Anonymous wrote:
Anonymous wrote:Subject says it all.


Never heard of being able to do this without the special circumstances others have noted. In general, don't buy what you can't afford.


I did this back in 2002. My $20k downpayment turned into $200k of gains in 3 years. Not bad at all.
Anonymous
Post 05/23/2016 14:55     Subject: How common is it to put 5% down on a house?
We put down 5% as first time buyers in 2012. We had student loans and daycare payments and not a ton of cash. We have stable jobs and plan to stay in the house long term. It has been fine.
Anonymous
Post 05/23/2016 14:43     Subject: How common is it to put 5% down on a house?
We did, with a VA loan. Otherwise, it would probably have taken us another decade to buy. It was fine.
Anonymous
Post 05/23/2016 14:40     Subject: How common is it to put 5% down on a house?
Anonymous wrote:Sellers don't see lending info like down payment (just whether you have secured financing).


Sellers absolutely see the down payment; it is part of the contract.

At the time of contracting, sellers do not know whether you will secure financing or not, as loan approval often does not come until a couple of days before closing, if then.
Anonymous
Post 05/23/2016 14:40     Subject: How common is it to put 5% down on a house?
Anonymous wrote:Sellers don't see lending info like down payment (just whether you have secured financing).

We did this, and the only catch has been that we won't be able to sell and upgrade quickly. Which is fine, just know that going in.

We were first time buyers, and I had just graduated law school (and my husband had just gotten his masters), so we had a lot of debt but also more income potential than actual income. (I work for the govt, so not huge income, but six figures.)


What are you talking about PP? Sellers ABSOLUTELY see how much cash you are putting down. This is why people often put large amounts down in highly competitive areas like the DMV.
Anonymous
Post 05/23/2016 14:33     Subject: How common is it to put 5% down on a house?
Sellers don't see lending info like down payment (just whether you have secured financing).

We did this, and the only catch has been that we won't be able to sell and upgrade quickly. Which is fine, just know that going in.

We were first time buyers, and I had just graduated law school (and my husband had just gotten his masters), so we had a lot of debt but also more income potential than actual income. (I work for the govt, so not huge income, but six figures.)
Anonymous
Post 05/23/2016 14:27     Subject: How common is it to put 5% down on a house?
Anonymous wrote:I know lots of folks who have done it in other cities, but I have a hard time imagining it working in a hot market like DC and the close-in suburbs. My impression is that sellers like to see more down, because it suggests more financial security and less likelihood that the deal will fall through. So, if you are in a market where multiple offers are a certainty, I could see losing repeatedly on financing alone.


I bought several years ago and maybe I've forgotten, but when do the sellers see what you've put down? I know they know how much earnest money, but I thought I finalized my down payment amount after the offer was accepted. Or have I blocked out the details of this process?