is a 20% down payment required on all home loans now?

Asked by Wanda Barnett, Culver City, CA Tue Nov 15, 2011

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, ,
Wed Nov 16, 2011

20% down is usually required only if the loan amount is over $625,500.

Happy funding, Rudi
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Amanda Contr…, Agent, Los Angeles, CA
Tue Nov 15, 2011
Hi Wanda,

The smallest down payment available would be getting a FHA loan which is 3.5% down. It's best to start with speaking to someone at your bank or a mortgage broker to see how much you qualify for. Once you have that information you should choose a Realtor who has an intimate knowledge of the areas that you'd like to buy in. If you'd like any referrals to trusted mortgage brokers I'd be happy to provide you with some. I'm work alot in Culver City and would be more than happy to assist you with any of your real estate needs.


Amanda Contreras
Keller Williams Realty
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Steven Ornel…, Agent, Fremont, CA
Tue Nov 15, 2011

There's a right way and a wrong way to go about buying a home and you have touched on what I consider THE most important first step one can take towards accomplishing the goal of home ownership - vetting your financing capability.

Please review the following to understand what constitutes a true Pre-Approval and why it can save you from wasting about $1,000 on a cancelled transaction:

Your Pre-Approval is only as good as the level of underwriting diligence expended by the person you work with. The Mortgage Brokers/Bankers I work with understand when I refer my Clients we want to identify any issues that might qualify as a “red flag” or Pre-Approval caveat. Many times, even before going into contract, the underwriting department is brought into “the Pre-Approval loop" for guidance, if necessary. You should demand the same from anyone you work with.

If you are not sure where to obtain your Pre-Approval you can ask any of the Realtors® on this forum who they would recommend in your area. If you are not happy with a referral I would suggest you work with a Certified Mortgage Planning Specialist. Mortgage Broker/Bankers with this designation have been trained in financing, investment, and tax planning topics:

Having been both a Mortgage Broker/Banker I have an experience-based opinion on where you should be seeking your financing and Pre-Approval:

"Retail Banks vs. Mortgage Broker/Bankers"…

(Includes useful links to "Rate Shopping - Do It Right" and "How Mortgage Rates Are Determined"

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Mike King, Agent, Los Angeles, CA
Tue Nov 15, 2011
Unfortunately, this is one myth that has not been adequately dealt with within the press, banks are lending, and they are not requiring 20% down on all loans, I just helped a buyer purchase a condo in Culver City with 5% down.

Find yourself an experienced loan broker, they know how to direct you to the best lender that will meet your needs.

For updated market information see my one minute Culver City market update below.
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Michael Abram, , Los Angeles, CA
Tue Nov 15, 2011
Hello Wanda,

20% is not required on all home loans now. There are many options of loans for you to choose from starting at 0% down (VA loans) to minimum 3% down (Homepath), 3.5% (FHA), 5%-up (Conventional). The best way to find out what options are best suited for your scenario would be to get pre-approved with a licensed loan officer who can break down all your options and see what best suits your scenario. Best of luck to you.

Michael Abram
First Capital Mortgage
NMLS #235060
Direct: (310) 434-1718
Cell: (310) 995-0975
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Maureen Fran…, Agent, Birmingham, MI
Tue Nov 15, 2011
Absolutely not. There are many programs out there that require less. Talk to a referred local mortgage adviser or two or three to get find out the options available to you.
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Scott Godzyk, Agent, Manchester, NH
Tue Nov 15, 2011
Wanda the simple answer is no, there ar emany kinds of loans such as VA and USDA which ar eno money down, FHA is 3.5% down and conventional loans start at 5% down, your credit does affect what kind of mortgage you may be able to get. your bets bet is to meet with a local and trusted mortgage broker, they can prequailify you at no cost, they will look at your credit plus your financials and let you know if there are any programs that you may quailify for and teh donwpayment requirements of each.…

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Dan Tabit, Agent, Issaquah, WA
Tue Nov 15, 2011
There are many programs available depending on your credit and the lender. VA and USDA offer 0 down if you meet their qualifications. FHA is as little as 3.5% down and depending on where you are buying conventional financing may be available for 5% or more down.
Talk to a local lender who can review your application and advise you of your options. There are no fees for an initial consultation and you may find you are able to buy sooner than you think.
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John Barry, Agent, Eagle Rock, VA
Tue Nov 15, 2011
Hi Wanda,

No, there are other loan options available requiring less of a down payment. You can get an FHA loan with only 3-1/2% down, and I just had a client recently qualify for a conventional loan with only 5% down. I would be happy to put you in touch with a good mortgage agent who would be able to help you out - let me know. Good luck with your search.

John Barry
DRE #01856079
Coldwell Banker Residential Brokerage
Cell: 323-810-7976
Twitter: @RealtorJB
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