I've heard a lot of mixed opinions and am shy about asking a bank so I thought i'd probe you guys first.

I am thinking of buying a house but don't want to shell out a bunch of cash on a downpayment. Are there banks that still do downpayment assistance, allow downpayment loans or do 100%+ LTV mortgages? I know most of this went away/changed the last 3 years after 9/11 but I wanted to know if anyone knows of anyone still doing it. Also, If I buy a house at 90 or 95% value, doesn't that eliminate/become the down payment? I heard regulations on these things have changed over the last few years.

I make plenty of money to afford a house, I just don't want to put a wad of cash into it right now. My motivation is getting out of paying 1200 dollar rent so I don't mind paying 700 as opposed to 500 for mortgage (or even 1000 as opposed to 800 becuase I would be making a huge upgrade anyway.

I basically want to have all fees/downpayment wrapped into the loan and pay no more than a few grand to move in even if it means paying significantly higher interest.

10/18/2011 5:20:47 PM

Move out to the sticks and get a USDA loan.

10/18/2011 5:50:15 PM

What price range are you looking in? What is your income?

10/18/2011 5:56:23 PM

Wow I just read about USDA for the first time and the area I'm shopping is actually "in the stick" as it is eligible for the program. Do tell me more! ~39k in monies and <120k in home.

10/18/2011 6:12:52 PM

My friend bought a house in Durham this year with zero down. She did it through BB&T. I have no idea what her interest rate is but I know it's higher than I got on mine putting money down.

10/18/2011 6:14:25 PM

USDA loan sounds interesting, my county/town has some areas that appear to be out in the sticks

10/18/2011 6:20:21 PM

ibt all the internet trolls sayin 'if you can't afford to put money in you can't afford a house'

but seriously though, i would be curious to know why you would be open to paying a significantly higher interest rate to obtain a 100% LTV loan, just to avoid putting anything into the house. that would cost you serious $texas, even if you didn't keep the house that long.

to answer your question, yes, most banks still offer 100% LTV loans for first time home buyers. Check USAA and NCSECU if you quality, Coastal Federal CU if you don't

10/18/2011 6:24:31 PM

Its simple. I want my money and right now I pay 1200 a month 0 of which goes to principle. How would it not make more sense to pay several hundred dollars a month less for more/better living space and have some of that going towards principle.

If you cannot look further than comparing this type of mortgage to the best type of mortgage then you are right, it makes no sense. Buf if you compare this type of mortgage to renting long term, its genius.

I don't want to put my whole savings into a house right now because certain opportunities may come up for me to use/need that money in the future.

[Edited on October 18, 2011 at 6:29 PM. Reason : ^im not a first time home buyer. ]

10/18/2011 6:29:29 PM

secu does 100% LTV, if youre eligible for membership

10/18/2011 6:38:43 PM

Quote :

"im not a first time home buyer"

i'm thinking it'll be harder to get 100% in that case...but i'm no expert here

10/18/2011 6:48:58 PM

Why don't you just take out a pay day loan? You need that money now, right?

10/18/2011 6:49:18 PM

I'm looking at some houses and condos as well

Is putting 50 down on a place thats 150-200 smart?

I want to make the whole process as streamlined as possible

10/18/2011 6:59:44 PM

^^If there were a situation where a payday loan saved me money, I would, jackass.

10/18/2011 7:11:21 PM

Quote :

"How would it not make more sense to pay several hundred dollars a month less for more/better living space and have some of that going towards principle."

Because for the first couple of years you would be putting zero towards principle if you put zero down.

Quote :

"im not a first time home buyer"

If it's been over three years since you last bought a house you can get a FHB loan.

10/18/2011 7:15:30 PM

Quote :

"How would it not make more sense to pay several hundred dollars a month less for more/better living space and have some of that going towards principle."

more chance of ending up upside down on your mortgage

also, you have to remember that there's more to owning a home renting a home from the bank than just paying your mortgage. utilities are probably gonna be higher, property taxes, you have to pay when shit breaks, higher insurance, maybe HOA dues, lawncare, etc etc etc

10/18/2011 7:25:08 PM

I think if you meet certain income requirements & other restrictions you can get an FHA backed loan with as little as 3.5% down.

10/18/2011 8:03:01 PM

I'm looking at LEAST 400 less than what I'm paying in rent.

10/18/2011 8:03:43 PM

a) it's principal not principle.

b) yes you can get 100% LTV's these days. But you better have a good credit score and the mortgage payment should be low compared to income.

c) look for govt programs, banks love anything they can package off immediately and just collect the fee income

10/18/2011 9:53:49 PM

Quote :

"property taxes"

Your bank pays this but you got to make sure to send in the bill.

10/18/2011 9:56:14 PM

^ LOL

You do realize the bank is paying those taxes with YOUR money that they collect in a little something called an escrow account, right?

10/18/2011 10:08:15 PM

^^ LOL

Quote :

"Where do I send my property tax bill? BB&T partners with First American Real Estate Tax Service to obtain the information to pay your property taxes from your escrow account, so in most cases you may keep the tax bill sent to you for your records."

10/18/2011 10:47:35 PM

Quote :

"I'm looking at some houses and condos as well Is putting 50 down on a place thats 150-200 smart? I want to make the whole process as streamlined as possible"

cash is king. put down the minimum necessary.

10/18/2011 11:09:54 PM

Quote :

"ibt all the internet trolls sayin 'if you can't afford to put money in you can't afford a house'"

That's a true statement. You shouldnt buy a house if you can't afford a significant down payment...but at 3.5-4% interest, with that interest tax deductible, I don't think you should put any money down if you can get 100% financing.

10/19/2011 12:08:34 AM

Quote :

"You do realize the bank is paying those taxes with YOUR money that they collect in a little something called an escrow account, right?"

Yes, but it's not a separate thing you are having to pay for in addition to your monthly mortgage payment is all I mean. You can't really lump it into the same categories as repairs, lawn maintenance, etc, because that tax bill is going to get paid out of your mortgage payment and/or escrow, whether you like it or not Other parts of owning a home you can just not pay for if you don't mind living in a hovel after awhile.

10/19/2011 8:53:29 AM

Quote :

"That's a true statement. "

oh wait, that was a true statement. i guess what i meant to say was:

Quote :

"ibt all the internet trolls sayin 'if you don't want to put money in you probably can't afford a house'"

Quote :

"because that tax bill is going to get paid out of your mortgage payment and/or escrow, whether you like it or no"

some lenders don't escrow

Quote :

"Because for the first couple of years you would be putting zero towards principle if you put zero down."

how's that? when i bought my house with 100% financing, i was putting 20% toward principal on my first payment. sure it's not a lot, but it was far from nothing.

Quote :

"If you cannot look further than comparing this type of mortgage to the best type of mortgage then you are right, it makes no sense. Buf if you compare this type of mortgage to renting long term, its genius. "

Well lucky for you, you *won't* have to pay substantially more in interest to get a 100% LTV...but if you had to it would be a pretty bad move.

10/19/2011 9:16:43 AM

Quote :

"some lenders don't escrow"

That's why I said "and/or".

10/19/2011 9:58:20 AM

Quote :

"your mortgage payment and/or escrow"

i'm not following this...your tax bill is either paid for out of your escrow account (which you contribute towards as part of your mortgage payment), OR it's paid out of your pocket/personal bank account. how can it be "mortgage payment and/or escrow"...that's the same thing, escrow account. which is why i mentioned that some lenders don't escrow, and you have to save up for/pay your tax bill on your own.

10/19/2011 10:11:11 AM

I know when we were shopping around for mortgages one of the ones we looked at you didn't pay escrow but you still sent in your tax bill to the bank to be paid. My understanding is it would come out of the mortgage payment you were making at the time, rather than out of escrow.

If you were putting 0% down, are there banks that would let you get a mortgage without escrow? It seems like the banks would want some escrow since someone paying 0% down is considered more of a risk of walking than someone who has put some money into the house.

10/19/2011 10:14:41 AM

Quote :

"My understanding is it would come out of the mortgage payment you were making at the time, rather than out of escrow."

hmm i've never heard of that system. what if your mortgage payment for that month wasn't enough to cover the tax bill? i think that would often be the case...my tax bill is 40-50% more than my monthly mortgage payment, and I would figure most peoples would be similar unless they have a 15 year or something (even if i had a 15 year it wouldn't be enough to cover my tax bill)

Quote :

"If you were putting 0% down, are there banks that would let you get a mortgage without escrow?"

Probably not, but I was just making the point that not everyone escrows. Some people have to save up and pay their own tax bill just like any other bill.

10/19/2011 10:25:42 AM

i wish wells would let me not escrow... i dont yet have their required LTV.

they seem to have zero ability to get the escrow amounts right.

i mean, it was nice to get a $2000 escrow refund check last week, but it irritates me that they required me to overpay by that amount for the last like 10 months.

in the 4 or 5 years i've had mortgages with wells, they either undershot by >$1000 or overshot by >$1000.

shouldn't be that hard.

10/19/2011 10:28:55 AM

Quote :

"shouldn't be that hard."

one would think. homeowners insurance is a static number, and property taxes don't change *that* often, and even when they change it's usually not by a large number.

10/19/2011 10:31:57 AM

Quote :

"hmm i've never heard of that system. what if your mortgage payment for that month wasn't enough to cover the tax bill? i think that would often be the case...my tax bill is 40-50% more than my monthly mortgage payment, and I would figure most peoples would be similar unless they have a 15 year or something (even if i had a 15 year it wouldn't be enough to cover my tax bill)"

Yeah I didn't really get how it worked and we ended up going with a mortgage that had escrow so I never bothered to dig any deeper.

10/19/2011 12:51:12 PM

+1 for secu

last time i was in there, they had 4.75% for a 2-year ARM at 100% financing, no PMI...this is for members who are first-time home buyers, of course

10/19/2011 12:54:04 PM

Something you are forgetting about is mortgage insurance. Likely, whomever buys your mortgage will require MI if you are over 80% LTV. This will add another $100-200 per month, which definitely makes it worth your while to pay down to 80%. Otherwise, you would have to make that ~$1200 up somewhere else with a good ROI

Another consideration is a HELOC. If you pay down to 80% LTV or lower, and a situation arises where you need $, you can do a home equity line for a reasonable rate

10/19/2011 1:43:06 PM

but pmi is another tax deduction (for now) so it's not that big of a deal

10/19/2011 1:47:14 PM

Quote :

"Something you are forgetting about is mortgage insurance. Likely, whomever buys your mortgage will require MI if you are over 80% LTV. This will add another $100-200 per month"

Have you really seen those kinds of PMI rates? I did a quote for a $200k loan through Coastal Federal Credit Union and they were charging ~$50/month in PMI...and I *think* they let you off the hook at 90% as opposed to 80%, but I doubt that is very common.

Quote :

"Likely, whomever buys your mortgage will require MI"

Another reason to go with a place like NCSECU that doesn't sell their mortgages (or require PMI at least for their FHB program).

10/19/2011 2:06:15 PM

10/19/2011 2:14:27 PM

This is random, but is there any way to become a SECU member outside of being a state employee, family of one, or live with one?

10/19/2011 2:45:05 PM

^ not to my knowledge.

https://www.ncsecu.org/AboutSECU/MembershipEligibility.html

10/19/2011 3:31:34 PM

^^yes, live with someone who is a current account holder, just show a piece of mail saying you live at the same address as an account holder.

10/19/2011 3:43:10 PM

10/19/2011 3:50:48 PM

Even though you can deduct pmi, it's still money you are just throwing out the window.
Escrow blows. No free loans for my bank. If you do opt out of it just make sure they don't try to charge you extra.

10/19/2011 4:19:39 PM

Im currently looking in to rbc's 100% financing fhb mortgage. 4.25% apr and no pmi on a 30 year fixed. Pretty much the same as bb&t's chip program.

10/19/2011 10:57:46 PM

Quote :

"Even though you can deduct pmi, it's still money you are just throwing out the window."

Why do people think that just b/c something is "Tax deductible" they're saving money?

yea, putting zero down for a 30 year loan is going to make it so you pay twice the value of the house. AND, unless you actually live there for 30 years you're going to have a hard time selling it for what you paid+closing, so you're definitely going to lose money. The only way I think you can end up in the black from this is if you can find some sort of investment that you'll make better than the mortgage interest rate (+escrow, PMI, and all the other crap) on that down payment that you're not making. But it sounds like you just don't have that money.... but I don't know your books.

10/20/2011 4:44:01 AM

It could appreciate plus some money from the mortgage is going towards principal.

10/20/2011 12:20:42 PM