Join the Meeting Place for Moms!
Talk to other moms, share advice, and have fun!

(minimum 6 characters)

4 Bumps

Keeping the current real estate market in mind, what do you think the new minimum down payment should be?

To avoid paying PMI, you must put 20% down on a house. Because lending was so fast and loose not so long ago and we are now dealing with the realities of our housing market, what do you feel the new minimum down payment should be for a conventional 30 year fixed loan?

Do you feel that 10% minimum is reasonable?

What impact, if any, do you think raising the minimum down payment will have on an already difficult market?

 
QuinnMae

Asked by QuinnMae at 2:09 PM on Feb. 16, 2011 in Politics & Current Events

Level 48 (291,805 Credits)
This question is closed.
Answers (15)
  • As a former banker I like 20 to 25%. Payment should be no more than 30% of your income and your debt to income ration should be less than 20%. This along with money in the bank will protect the bank AND the homebuyer.
    yourspecialkid

    Answer by yourspecialkid at 4:28 PM on Feb. 16, 2011

  • I think more like 20% is reasonable on the bank's side. And...a monthly payment no more than 1/4 of the take home pay. JMHO
    jewjewbee

    Answer by jewjewbee at 2:13 PM on Feb. 16, 2011

  • What impact, if any, do you think raising the minimum down payment will have on an already difficult market?


     


    I don't think it will negatively impact the market. I think it will add confidence to the housing market and rebuild a weak mortgage system, resulting in more investing, etc...

    grlygrlz2

    Answer by grlygrlz2 at 2:24 PM on Feb. 16, 2011

  • What impact, if any, do you think raising the minimum down payment will have on an already difficult market?

    **
    depends on who you ask. cash buyers for investments are coming out of the woodwork, and people who should have never had homes no longer do and won't until they can afford it. I never believed easy homeownership should have been had by anyone to improve an economy. Home ownership should have been an individual's decision based on their needs not wants and what they could have afforded easily. Debt to income ratios were thrown out the window with so many purchases, and that should have been the first thing considered after the appraisal.
    jewjewbee

    Answer by jewjewbee at 2:18 PM on Feb. 16, 2011

  • I think that the down payment doesn't have much to do with the housing crisis. The problem we have is that people were getting loans that were too high in value. For instance I know someone personally with an income of just over 20K that got a loan for a 180k house. That seems ridiculous to me.

    It seems to me that there needs to be a better rule about the total house cost a person can bear. I've heard rules like three-times the annual income, or as % of monthly income toward the mortgage - anywhere from 15-35%. People pay that much every month toward their apartment, so why not a mortgage? The issue seems to be fiscal responsibility and overstretching their budget - not the down-payment.

    angelm523

    Answer by angelm523 at 2:22 PM on Feb. 16, 2011

  • 30% sounds good to me....
    grlygrlz2

    Answer by grlygrlz2 at 2:22 PM on Feb. 16, 2011

  • I agree with 10 percent. Although it should go up as the price of your house does. So if you're getting a quarter mill house then I agree with 20. And so on.
    2murphyboys

    Answer by 2murphyboys at 2:11 PM on Feb. 16, 2011

  • I believe 20% would be best. I have heard a possible 30% but I feel that is too high.
    zebbiebug

    Answer by zebbiebug at 2:17 PM on Feb. 16, 2011

  • I think that 20% is a good goal, and a 10% requirement is very fair. Maybe it should even be higher, but that would also make it harder for first time buyers to ever get in to a house of their own. We bought our first house with only 3% down, and you certainly couldn't do that these days. It makes a lot of sense in an attempt to stabilize the housing market though, since people are less likely to walk away if they have more invested in their houses.
    JulieJacobKyle

    Answer by JulieJacobKyle at 2:18 PM on Feb. 16, 2011

  • There shouldn't be a minimum, it should be up to the banks. There are many families whose montly rent payments could easily be paying a mortgage instead but for a costly downpayment, and it should be left up to the banks to determine if those folks are able to make mortgage payments or not.

    Of course if they invest irresponsibly, there should be no federal bailouts (of banks or homeowners).
    riotgrrl

    Answer by riotgrrl at 2:40 PM on Feb. 16, 2011

close Join now to connect to
other members!
Connect with Facebook or Sign Up Using Email

Already Joined? LOG IN