When we bought our condo in Boston in 2009, there were pretty strict rules about downpayments and PMI (20% down if you didn't want PMI, and 15% down regardless). We sold a year ago and moved but are relocating back east in about 6 months and looking to buy again in the summer. I'm wondering what the landscape is for mortgages now. If you recently bought a home (not condo, since they seem to have different rules)....how much did you put down? Do you have PMI? What was your interest rate? Thanks!
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@winniebee: Interest rates are low! but rising slowly and are sure to continue going up as the market heats up this spring/summer. PMI still for less than 20% down, but a big difference now is that once you've got 20% paid into your house thru principle payments, PMI disappears forever! Woot. We've been hunting relatively seriously for the past few months, including putting in a few (failed) offers, and we've had no problems getting preapproval for loans in the low to mid 400k's. According to our mortgage broker, "anything is possible", even with all the precautions lenders are taking now. Let me know if you need a good mortgage broker! We love ours.
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@mrs. wagon: Interesting, thanks! See, the thing is....we have a great downpayment for a decent home where we are moving from the sale of our last home. But probably only 10% down for our "dream home" - ie, a house near the water. I didn't know if even putting less than 20% down was an option for single family homes these days.
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@winniebee: yup, we've even looked into as little as 5% down. Harder to find a loan but not impossible. And our mortgage broker has even looked into FHA loans for us even though we're not first time home buyers. He said the loaners don't care!
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@mrs. wagon: send me the name of your broker. we might need someone in the state we are moving too, but you never know!
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We put down 8% on our current house no problem, and are paying PMI. I will note that PMI is higher now than when we bought our first house 3 years ago. Our current house was $80k less than last house, and we pay $35 more per month in PMI, which feels crazy! Can't wait to get to 20%!
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I think it depends on whether or not you are in conforming or non conforming loan territory. The rules are very different.
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@looch: how do you find out whether the area you are moving to is conforming or not?
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We put down 10%, and pay PMI. Our interest rate is 3.5%. We locked our rate beginning of Jan 13 and closed Feb 1.
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@winniebee: sorry, i should have been more clear, conforming/nonconforming is based on the purchase price of the home. They vary by county/state.
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@looch: hm the conforming limits for that area are not very high.
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@winniebee: so, you might need a non conforming loan then? I'd call a mortgage lender from that area and ask what they're offering. They will know based upon what you are putting down vs. purchase price where you fall.
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Didn't the PMI rules (laws?) recently change, so PMI is a bigger deal now than it was a few years ago?
We bought Dec 2012; 20% down and 3.75% interest.
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We qualified for a loan through our bank called a ph ysicians loan. It required 0-5% down (based on home price) with no PMI. Maybe you could look for something like that.
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@winniebee: done!
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We bought in June of 2012 with 5% down, 15-year mortgage, 3.375 interest rate, and we will have to pay PMI until we are at 20%.
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We bought in August, and got a loan through the Virginia Housing Development Agency, and we got a conventional loan with only 3% down and no PMI (5% interest). BUT, we were only able to qualify for that loan because we were first-time home-buyers. The loan we were looking at through Wells Fargo required 10% down + PMI.
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@yellowbird: my husband is a physician. Tell me more!
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@winniebee: We put down 0% and pay zero PMI. Our interest rate is 4.75% fixed rate 30 year. But this was 2 years ago.
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@littlek: is that because you have a loan for your down payment? This was a pretty common way to avoid PMI, but I thought it wasn't done any longer.
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@looch: Nope, we didn't make a down payment.
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@winniebee: I know several banks in my area offer this type of loan. I honestly didnt look at different mortgages because I knew I could get this one.
Our bank is a small regional bank, but you could probably call around to the bank you use or banks in the area and see if they offer this type of thing.
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@littlek: I am intrigued. No down payment, no PMI, no loan for the down payment?
The only other thing I can think of is a pledge! You've stumped me!
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@littlek: wow that is crazy. I don't expect that but would love to put down 10%.
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@looch: I don't remember the details. My DH bought our current home. I own a rental property.
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@littlek: okay, fair enough!
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@winniebee: I've heard of this physician's loan but only through a high school friend who went through a really bad experience because most banks got rid of this program in the Boston area, at least. Both she and her husband are physicians and they ended up having to walk away on closing day because the bank wouldn't put the last of the paperwork through. She searched and the only bank that still offered it was Bank of America, and they stalled out and the deal fell through. I would call some area local banks and see if they still have physicians loans programs going.
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Small local banks can do whatever they like! I know a few friends who have purchased homes with large mortgages and less than 20% down with no PMI by getting their loan through a local bank. As long as a local bank is going to be holding your loan and not trying to sell on the secondary market, then they can use their own underwriting standards to determine whether they think it's a prudent investment!
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@mrs. wagon: we just got this loan in May of 2013. I am not in boston and our cost of living is way, way lower where i am!
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@Sparkler: yes, they put it on their balance sheet!
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@yoursilverlining: I think that's for a FHA loan - you pay PMI the entire loan, not just until you reach 205 down.
We put 0% down. We borrowed our down payment from a non-profit that encourages home ownership among low/middle income buyers. Our interest rate was 4.375, and we pay 6.375 on the down payment loan. That made more sense for us to do than to do an FHA loan, or to wait a few years and risk interest rates being higher.
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@littlek: wow I didn't know you could still get a loan like that since housing crash
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We put 20%... I want to say our rye is 3.3%? No PMI.
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We got a doctor loan in 2009. Zero down, no PMI. From a large regional (mostly southeast) bank. I know the program isn't quite as popular as it used to be, but friends of ours graduating residency and not doing fellowship just got one to buy their forever home. They close in February.
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We put 20% down and got a rate of 4.0% in October 2013 which apparently was the lowest by about .3%.
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We just bought our first single family home north of Boston! We were in a townhouse before that we did with an FHA loan with 10ish% down.... We did 20% down on this house and our rate is just below 4% for a 30-yr fix, no PMI... Rates are still pretty great! Good luck!
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@looch: @littlek: USDA loan? We closed in sept. and put 0 down, no pmi, 4.74% for 30 years.
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We locked our jumbo (nonconforming) loan in late november, closed in mid december, 25% down, 4.125%.
30 year fixed, no PMI. But plan to pay off within 20 years.
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We bought in June 2013 (in FL). Paid 5% down, no PMI and 3.875% on a 30 year loan. We chose that over a 3.75% rate with PMI until we reached 20% equity for which we also qualified.
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We bought this past summer (condo, not a house but it's a conventional loan so no difference). We put down 25%, no PMI, but we know this is not our forever home so we're doing a 10 year ARM at a 2.5% interest rate. We plan to move to something bigger in 3-5 years so 10 years gives us time to wait out a temporary dip in the market to sell if we have to.
We're actually hoping to have it paid off in 10 years, but obviously home prices where we live are sky high, so we'll see if that pans out.
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