BTW Catherine, I work hard and take care of my family also (not that that somehow entitles a person to a loan). It also took me about 10 years to save up the down payment on my first house. Home ownership is not a right, and you are not helping anyone by encouraging people with a poor track record of debt repayment and saving to take on more debt than they can likely handle. If Mark has the income and discipline to fulfill a mortgage obligation, he probable also can take the first steps of improving his credit and building some savings.
If you can come up with 3% of the purchase price you may want to look at an FHA loan. FHA also allows the 3% to come as a gift from family etc. You may want to contact a lender you trust familiar with FHA loans. In the meantime I would concentrate on imporving your credit score and saving a little cash for a downpayment.
Good luck, Filly
I'm in a similiar situation, I don't have a down payment saved up. I'm still in the process of getting a loan however from a responsible lender. People who say you need 10% down and good credit are just elitists they only want the wealthy to have homes. Fortunately there are programs out there designed by people who understand if you work hard and take care of your family, you probably don't have enough extra to stash 40,000 in the bank. It doesn't mean you don't deserve to enjoy the same dream of homeownership as everyone else.
Just look at your finances and see if you can actually afford the payment. Ignore the gimmick ads in the pennysaver and elsewhere (that claim low payments for high amounts) a real loan will run about 2000 a month (for around 250,000) and a regular lender will expect twice that in income. If those numbers are out of your ballpark then you might want to look into a mobile home or condo. If you pay more than that in rent now, go down to Wells Fargo and see what they can do for you, I recommend Linda Collier she will give you the straight truth (and she knows the programs).
In California, there is no guarantee when prices might go back up, so if you find a lender who will work with you and you can make the payment go for it. Good luck!
Rob gave you great advice. You might also look to partnering with someone else to buy together. Your appreciation may be minimized, however, so will your risk. I have a basic partnership agreement I can send you for free and I can also suggest some ways to find potential partners. You might both want to live there or one just uses it for equity sharing. If you need more information, let me know.
Actually there are options out there. If you fall within the income limits, there are some terrific down payment assistance and grants offered by the City of San Diego, County of San Diego and State of CA. I usually combine these programs with a FHA 30 year fixed mortgage. FHA does NOT require you to have a high credit score to get an excellent 30 year fixed interest rate. I would have to take a look at your current income, job history and credit report to design a low or no down program for you. Zero down is possible.
And if you happen to be active military or a veteran, VA and CalVet still offer 100% financing.
Sr. Loan Officer
Hope this helps...Catherine Barden, Realtor