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cindy104
This is my "Baby"
Member since 6/08 1522 total posts
Name:
Cindy
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PMI Question
Has anyone recently heard of anything about not even being able to GET PMI.... if you're buying a home on long island and you're not putting at least 10% down?
DH and I spoke with a couple of banks/mtg brokers today and they said b/c of how many foreclosures there are on Long Island, you can't even get PMI, unless you put down at least 10%
Has anyone ever heard of this!!??
Please tell me this isn't true b/c we'd like to only put 5% down so we have more of an extra cushion in the bank!
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Posted 1/26/09 11:29 PM  |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: PMI Question
I don't know many banks that are still loaning out with only 5% down. So this doesn't surprise me.
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| Posted 1/27/09 8:28 AM |
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Kara
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Member since 3/07 13217 total posts
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Re: PMI Question
I wouldn't be surprised at all to hear that banks aren't willing to lend to first time home buyers who are only putting down 5%. That's pretty common right now.
PMI isn't your only option - you could also do an 80/15 loan (80% primary mortgage, 15% HELOC). However, I don't think most banks will do that right now either. I think they are looking for 10-20% down now.
Have you looked into any government programs and whether you qualify for those?
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| Posted 1/27/09 8:32 AM |
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cindy104
This is my "Baby"
Member since 6/08 1522 total posts
Name:
Cindy
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Re: PMI Question
Thank you, I appreciate your replies 
I would understand the reason as well as you both said....but it bothers us that for the past year we have always been told we were "fine" and "pre-approved" etc. Why didn't brokers tell us this from the beginning!?
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| Posted 1/27/09 9:35 AM |
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CoachC
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Member since 8/08 275 total posts
Name:
Kerri
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Re: PMI Question
You can definitely put less that 10% down. We had 3 banks competing for our loan and we put down less that 10%. They even told us we could put down as low as 3% because we have great credit. We went straight to the bank and didn't deal with an outside brokerage.
ETA: The banks are obviously well aware that we have the money to put 10% down, but we want to put money into the house and the difference in the monthly payments was minimal. We just didn't want to be so strapped after the downpayment.
Message edited 1/27/2009 12:01:55 PM.
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| Posted 1/27/09 12:00 PM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: PMI Question
Posted by CoachC
You can definitely put less that 10% down. We had 3 banks competing for our loan and we put down less that 10%. They even told us we could put down as low as 3% because we have great credit. We went straight to the bank and didn't deal with an outside brokerage.
I think this is very YMMV and really depends on the location and property being bought.
They can say all they want that you can only put down 3%.... that is until they see the appraisal report. Then you will really find out what you need to put down.
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| Posted 1/27/09 12:03 PM |
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CoachC
LIF Infant
Member since 8/08 275 total posts
Name:
Kerri
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Re: PMI Question
Posted by ave1024
Posted by CoachC
You can definitely put less that 10% down. We had 3 banks competing for our loan and we put down less that 10%. They even told us we could put down as low as 3% because we have great credit. We went straight to the bank and didn't deal with an outside brokerage.
I think this is very YMMV and really depends on the location and property being bought.
They can say all they want that you can only put down 3%.... that is until they see the appraisal report. Then you will really find out what you need to put down.
Not sure what YMMV means, but I'm assuming you are saying everything is dependent on the situation, and of course it is. I'm just saying that it's out there. Maybe not ALWAYS possible, but it is possible. I wouldn't have said it if I hadn't experienced it. .
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| Posted 1/27/09 1:00 PM |
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sunnyplus3
:)
Member since 11/05 8749 total posts
Name:
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Re: PMI Question
Posted by cindy104
Thank you, I appreciate your replies
I would understand the reason as well as you both said....but it bothers us that for the past year we have always been told we were "fine" and "pre-approved" etc. Why didn't brokers tell us this from the beginning!?
last year & this year are different worlds in lending. I'm sure the people you're working with did not think things would change so drastically. I think 10-15% should be the LEAST people should be able to put down. IMO if you can't do that much you're buying too much house. This is not the right time to start out with so little equity.
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| Posted 1/28/09 7:51 AM |
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rkoenke
my little piggys
Member since 3/08 4315 total posts
Name:
rachel
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Re: PMI Question
Posted by Kara
I wouldn't be surprised at all to hear that banks aren't willing to lend to first time home buyers who are only putting down 5%. That's pretty common right now.
PMI isn't your only option - you could also do an 80/15 loan (80% primary mortgage, 15% HELOC). However, I don't think most banks will do that right now either. I think they are looking for 10-20% down now.
Have you looked into any government programs and whether you qualify for those?
You mention "first time home buyers" do banks really look at that? It never occured to me that banks take this into account...
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| Posted 1/28/09 8:01 AM |
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ave1024
I Took The Wrong Road
Member since 12/07 6153 total posts
Name:
That Led To The Wrong Tendencies
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Re: PMI Question
Posted by rkoenke
Posted by Kara
I wouldn't be surprised at all to hear that banks aren't willing to lend to first time home buyers who are only putting down 5%. That's pretty common right now.
PMI isn't your only option - you could also do an 80/15 loan (80% primary mortgage, 15% HELOC). However, I don't think most banks will do that right now either. I think they are looking for 10-20% down now.
Have you looked into any government programs and whether you qualify for those?
You mention "first time home buyers" do banks really look at that? It never occured to me that banks take this into account...
I don't think it hurts for a bank to see an existing or paid off mortgage on your credit report.
If they see that you have already been through "the grind", they may be a little less paranoid lending out their money in these tough economic times.
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| Posted 1/28/09 8:11 AM |
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cindy104
This is my "Baby"
Member since 6/08 1522 total posts
Name:
Cindy
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Re: PMI Question
Thank you again everyone. Turns out I as getting another "story" from another broker....there are still lenders that do this.
Message edited 1/28/2009 8:27:21 AM.
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| Posted 1/28/09 8:27 AM |
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cindy104
This is my "Baby"
Member since 6/08 1522 total posts
Name:
Cindy
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Re: PMI Question
Posted by KellyFG
Posted by cindy104
Thank you, I appreciate your replies
I would understand the reason as well as you both said....but it bothers us that for the past year we have always been told we were "fine" and "pre-approved" etc. Why didn't brokers tell us this from the beginning!?
last year & this year are different worlds in lending. I'm sure the people you're working with did not think things would change so drastically. I think 10-15% should be the LEAST people should be able to put down. IMO if you can't do that much you're buying too much house. This is not the right time to start out with so little equity.
You're right...things are VERY different. But I disagree with the fact that if you only want to put 5% or whatever %age for that matter....doesn't necessarily mean that you're buying too much house. I feel that if you can provide the proof of your income and that you can make the bills/payments and you show a good history of credit, you can do just fine.
Majority of our foreclosure problems today come from many people who decided to "go stated" (not showing any proof of steady income) and all the banks that let them. Banks were way to generous and laxed on people getting mortgages and now for buyers who do show good history and show steady income, it doesn't matter.
Message edited 1/28/2009 9:19:42 AM.
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| Posted 1/28/09 8:35 AM |
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sunnyplus3
:)
Member since 11/05 8749 total posts
Name:
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Re: PMI Question
Posted by cindy104
You're right...things are VERY different. But I disagree with the fact that if you only want to put 5% or whatever %age for that matter....doesn't nessecarily mean that you're buying too much house. I feel that if you can provide the proof of your income and that you can make the bills/payments and you show a good history of credit, you can do just fine.
Majority of our foreclosure problems today come from many people who decided to "go stated" (not showing any proof of steady income) and all the banks that let them. Banks were way to generous and laxed on people getting mortgages and now for buyers who do show good history and show steady income, it doesn't matter.
We can agree to disagree but there is a reason why the first 100 years of residential mortgages in this country required a minimum 20% downpayment. There is a VERY good chance home values will drop at least another 5% over the next year or two. So what I'm saying is if you only put 5% down & some emergancy arises & you need to sell or try to refinance you will be upside down, just like all of those subprime borrowers. Do what you like, I'm just sharing my opinion as a homeowner & experienced real estate investor.
Message edited 1/28/2009 9:36:46 AM.
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| Posted 1/28/09 9:35 AM |
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cindy104
This is my "Baby"
Member since 6/08 1522 total posts
Name:
Cindy
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Re: PMI Question
Posted by KellyFG
Posted by cindy104
You're right...things are VERY different. But I disagree with the fact that if you only want to put 5% or whatever %age for that matter....doesn't nessecarily mean that you're buying too much house. I feel that if you can provide the proof of your income and that you can make the bills/payments and you show a good history of credit, you can do just fine.
Majority of our foreclosure problems today come from many people who decided to "go stated" (not showing any proof of steady income) and all the banks that let them. Banks were way to generous and laxed on people getting mortgages and now for buyers who do show good history and show steady income, it doesn't matter.
We can agree to disagree but there is a reason why the first 100 years of residential mortgages in this country required a minimum 20% downpayment. There is a VERY good chance home values will drop at least another 5% over the next year or two. So what I'm saying is if you only put 5% down & some emergancy arises & you need to sell or try to refinance you will be upside down, just like all of those subprime borrowers. Do what you like, I'm just sharing my opinion as a homeowner & experienced real estate investor.
Home values won't be dropping much more. And if an emergency arises I'll have the large cushion in the bank....since I only put the 5% down. And I don't think I'd be refinancing anytime in the near future, since I don't see getting any better then 4.5%!
I understand you're just sharing your opinion...much appreciated....love opinions 
Thank you!!
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| Posted 1/28/09 9:49 AM |
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