Down Payment Requirements for your Los Angeles Home

Okay … I want to know.  WHO started the rumor that you need 20% down to buy a home?

Whoever it is, we need to get to them and straighten them out.  We need to educate them about the real opportunities that currently exist in the home buying market and mortgage lending today!  This rumor floating around is doing serious damage to our home buying market ... and it’s scaring people.



Just the facts …

We in the real estate industry (all branches) need to get serious about addressing this rumor.   The truth is: Money … financing … is available for those with less than 20% down on their home purchase!

And while no one knows for sure if home prices have “bottomed-out” … what the markets will do … and how that future market activity will effect interest rates … we DO know some things for sure RIGHT NOW.   Most notably, they are:

1.  Home Prices have fallen in many areas of the U.S. to pre-boom, ‘2002/2003’ prices.  In some areas, even lower.

2.  Foreclosures, Short-Sales, and a glutted market/extremely slow sales have made it (currently) a buyer’s market.

3.  Interest Rates have remained fairly stable and favorable for those looking to secure financing.

4.  Normal FHA loans currently require only 3.5% down payment.

5.  Financing exists for FHA – HUD properties, (already foreclosed upon) that need only a $100 down payment.

6. Many times, only 3% down is required on Fannie Mae-owned properties.

7.  Nothing stays the same or lasts forever …

All the above-listed things point to it being a favorable time to buy a home in the Chicagoland area and elsewhere. So where are the first-time home buyers?  Where are the step-up home buyers?  Why are they not taking advantage of this favorable market and good interest rates?  Yes, I understand there ARE real issues that stand in the way of many.  Selling an existing home being one.  But for those that CAN sell … CAN buy.  Where are they?  Where are those capable of

becoming home buyers?

Aaahhhhh …. those pesky rumors again!

In order to take advantage of these housing and financing options and current market advantages here in Chicagoland and elsewhere, potential home buyers must be “in the hunt” for their financing and new home.  They  MUST NOT FEAR the buying “process” so greatly that they won’t enter it.  And that leads us right back to the rumors being bandied about regarding down payments.

Education is key to getting potential home buyers back to … buying homes!  We must combat the rumors!

I believe that, should we educate our potential home buyers so they know and understand the facts about home buying and mortgage financing, their fears will be dispelled.  In larger numbers, we lenders will receive more requests for pre-approvals.  Agents will receive larger numbers of requests for home viewings … and then secure sales/purchases of more homes.  We can fight these rumors, if agent and lender combine efforts.  It’s important to get the truth out to the public and media alike … in Chicagoland … and all over the U.S.!

NO MORE RUMORS! Just the facts …

Original post by Gene Mundt

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