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New to Flori…, Home Buyer in Jupiter Inlet Colony,...

Are most banks requiring 20% down these days, even if a person has excellent credit?

Asked by New to Florida, Jupiter Inlet Colony, FL Fri Jan 23, 2009

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13
Go FHA 3.5% down, you can put down more if you wish
Web Reference: http://mypbchomes.com
0 votes Thank Flag Link Sat Dec 5, 2009
Can someone please update me on down payment for a jumbo loan in California? A loan amount of 800-900k?

Do you need 20% down or can you get one with 10 or 15%?

Thanks
0 votes Thank Flag Link Mon Sep 14, 2009
Stacey, hopefully your mortgage search has worked out. I've run into a problem with securing a loan, but it's because PMI companies don't want to write Florida policies. The lender approved the loan with 10% down, given the credit scores of myself and the co-borrower are in the 800's and low to mid 700's, we have zero debt (no car loans, no credit card balances, nothing), and make enough to afford the monthly payments. Then two days before closing, the lender finds out that the PMI company is making excuses to not write the policy, and they are questioning the appraisal even though the lender and the insurance companies (both flood and hazard) accept the appraisal, and have a lot more at stake in the deal! The PMI company claims there were not enough comparable comps used in the appraisal, because not enough of the comps are almost exactly the same. Given the lack of sales recently, and the inherent variability in homes in the area (varied sq. ft, varied lot sizes, pools or no pools, canal waterfront vs. open bay waterfront), it would be nearly impossible to get such exact comps as they are demanding, and they don' t want to accept the appraisers adjustments to account for those differences that were accepted by the lender and insurance companies. So we're essentially stuck in limbo in between houses, and our lender and the appraiser are trying to fight it out with the PMI company. It seems to me that if PMI companies are going to be that overly cautious now, they should make it clear to lenders that they are no longer doing business in Florida (or parts of Florida) to avoid buyers and lenders setting up contracts that then get denied because PMI companies don't want to do business. It would save everyone a lot of time, money, and stress. However, without PMI, Florida real estate is going to be in really bad shape for a long time to come, as having 20% down is not possible for most.
0 votes Thank Flag Link Mon Sep 14, 2009
Lending answer:

Yes, there are situations in which 20% down would be required on a conventional loan. Conventional loans are mortgages sold to Fannie Mae or Freddie Mac without a Federal insurance guarantee such as FHA, VA, or USRDA.

When applying for a mortgage, you must satisfy as many as three separate entities. First, you must meet Fanne Mae's or Freddie Mac's guidelines unless your lender will hold the loan in its portfolio. Second, you must meet the lender's own guidelines which may be more restictive than those issued by Fannie or Freddie. Finally, if you are putting down less than 20%, you must meet the guidelines on the private mortgage insurance company since Fannie and Freddie require PMI on all loans with less than 20% down.

Now here are a few situations in which 20% down would be required on a Conventional mortgage REGARDLESS of credit score or history:

1.) You are purchasing a condo, townhouse, or attached housing in Florida ro a similar "distressed market" and your lender uses Genworth for private mortgage insurance

2.) You originated your mortgage loan with a broker and the lender requires you to use PMI Group for private mortgage insurance

3.) You are buying attached housing in a distressed market and your lender requires use of MGIC for private mortgage insurance.

4.) You are buying a manufactured home in a distressed market.
0 votes Thank Flag Link Sun Feb 15, 2009
It really depends on a number of different factors to determine how much you need to put down, but just like all of the answers given before, you can still borrow up to 96.5% of the value of your house through an FHA loan. To see the loan limits in your county, click on this link:

https://entp.hud.gov/idapp/html/hicostlook.cfm

There's also other products that can finance more or less depending on your situation. As a loan officer for National City, I might be able to help you. Feel free to give me a call 561-573-2955
0 votes Thank Flag Link Sat Feb 14, 2009
No USDA in Palm Beach County Florida

Stacey - work with a local... rules here are too convoluted to trust someone out of state like that
0 votes Thank Flag Link Mon Jan 26, 2009
FHA= 3.5%, USDA = 0%, conventional in Florida is available at 10%.

I am a mortgage broker. If I can be of service, please let me know!

Martin Smith

Precision Funding
877-238-6324 Ext 704
513-536-7184
877-238-6324 FAX
MSmith@PrecisionFundingUSA.com
http://www.PrecisionFundingUSA.com
0 votes Thank Flag Link Mon Jan 26, 2009
FHA is an option if you have a small down payment
you can still get to 90% as long as you're buying a house - not a condo...

you will have to have excellent credit - and also you MUST provide taxes and bank statements.

David Podgursky
Boca Executive Realty & Mortgage
561-504-6949 cell
dp@bocaexecutive.com
0 votes Thank Flag Link Mon Jan 26, 2009
What if you require a jumbo loan (living in California or other overpriced market)? Do you need 20% then?
0 votes Thank Flag Link Fri Jan 23, 2009
Like it was said before FHA only requires 3.5% down. You can still get a conventional loan with only 5% down. If you are a veteran and could qualify for the VA loan there is no down payment required. There are so many differen loan programs available. It all depends on what your goals are. Please give me a call or email with any questions or for a free consultation.

Thank You,

Dominique Ressurreicao
American Pacific Mortgage
559-892-6812
0 votes Thank Flag Link Fri Jan 23, 2009
There are no rules when it comes to the practices of banks and lenders [sort of]. The lender wants to be as sure as possible that the borrower is QUALIFIED and that the probabilty of making the monthly payments is secure.

• Job Stability
• Credit
• Income
• Expenses
• Continuity of Employment

These are a few of the criteria a lender will use to make a decision. 20% is rather normal these days- 10-15% is a real possibility.
0 votes Thank Flag Link Fri Jan 23, 2009
Stacey:

Depending on the loan amount you could qualify for FHA financing with as little as 3.5% down. Check with Hud.gov for information.
0 votes Thank Flag Link Fri Jan 23, 2009
Not really, but it depends on your unique circumstances. Credit score is only one piece of the puzzle. The other pieces are property type,debt, income, and down payment and reserves.

If you are buying a primary residence and you have a good,stable income without a lot of debt then you should have no problems getting a conforming loan with 10% or 15% down or an FHA loan with as little as 3.5% down.

If you're trying to buy a condo or an investment property then you may need a larger down payment.

Speak with a reputable, local lender who can try and lay out your options for you
Best of luck,
Tony
0 votes Thank Flag Link Fri Jan 23, 2009
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