Does everyone agree? 20% down?

[skruggie]

Not only that, but it's too easy to walk away from a house if a person has very little invested in it, which has occurred in droves.

Home ownership is great, but there are so many expenses that people don't take into account when comparing renting to buying. A new furnace could run well over $10,000. Windows, roofing, removing dead trees from your lawn, and so forth can quickly outrun rental expenses quite easily.

Thankfully none of these apply to condos (maybe the windows).

I realize condos come with their own set of expenses, but let's keep in mind that not everyone who buys is doing so with a SFH.

[herdjohnson]

Thanks all for the responses. I found out over the weekend that I can actually go month to month at my current apt once my lease is up without paying any sort of premium. That was my only big rush is that I didn't want to re-sign a lease once my current one was up.

However, I still can't guarantee I'll go with 20%. I'm currently saving 800/month toward my down payment. I have about 5000 right now, so looking at a home between 125k-150k, I would still have likely 3.5-4 years of saving before I had enough for the downpayment, closing costs, reserves, etc... I'm worried the market may not be so buyer friendly as it is right now.

[MonkeyMama]

Thankfully none of these apply to condos (maybe the windows).

I realize condos come with their own set of expenses, but let's keep in mind that not everyone who buys is doing so with a SFH.

When I owned a condo, we paid more for HOA fees than we ever probably will to maintain our current home. Condo ownership is in the same league of home ownership. Certainly was my experience. I did feel the condo was lower maintenance, but financially don't feel it is much different to own a SFH. HOA fees are just more fixed and predictable (usually) than home maintenance expenses.

[EconoMutt]

"I'm worried the market may not be so buyer friendly as it is right now.[/QUOTE]

If you think house prices are cheap now, wait until next year. The experts predict another drop in prices.

[emanon1501]

This is my second home and I never put down 20 percent. I put down 0 percent for my first home in 1997. I put down 10 percent for this home in 2007. No regrets. Not everyone can put down 20 percent. Do consider taking out mortgage at 20 years or less. That will bring the balance down much quicker to get rid of PMI sooner.

[Frugal]

I agree on 20%, but think it would ideally be best to put down as much as you can, even 30% or 40%, to pay less interest over the life of the loan. The banks make a fortune on the mortgage business. However, it depends on how long someone will live in their house, and other factors, as well, like total income and expenses.

[disneysteve]

I would still have likely 3.5-4 years of saving before I had enough for the downpayment, closing costs, reserves, etc... I'm worried the market may not be so buyer friendly as it is right now.

You should not allow market conditions or economic conditions or interest rates or any other external factors to influence when you buy a home. You should buy when YOU are financially ready to do so. To me, that means that you have a 6-month emergency fund in place AND you have a 20% down payment on a home for which your monthly payment will not exceed 28% of your monthly income. If you don't have your EF, can't afford a 20% down payment or need to borrow an amount that will give you a higher than 28% payment, you can't afford the house and aren't ready to buy.

[poorgradstudent]

I bought my first house two years ago putting down 3%. I understand the reasons why it is not ideal, but I did not have enough money saved up to put down 20%. Although take into account that I got an $8K check from Obama's housing stimulus. And I have a roommate who pays over half the mortgage and utilities. As far as maintenance, I really enjoy doing work around the house. I have spent quite a bit updating and fixing up things, and although I am sure I will not get all of it back when I sell the house, it has been worth it. I hope housing prices go up in a couple years when I graduate and look to sell, but even if they don't I think I will come out a little ahead.

[photo]

I don't believe any 20% down, if I needed then it worth it, if I don't, then 50% down is nothing to me.

You work in government, don't you...