20% down in So-Cal

[want2b_800s]

I keep reading about how the 20% down payment is now pretty much mandatory due to the whole subprime mortgage crisis. However, I'm just wondering how many people who live in Southern California actually have the 20% or 160 - 200k down to meet that requirement.

I don't know many people with access to that much $$$$, and I would dare to say that the majority don't have that much -- especially since EVERYTHING here costs so much. I guess the 3% down is the best we can do, which is far more doable, but are the rates awful for a 97% loan?

I think this mortgage thing is going to get a lot worse before it gets better. Ughhhh!!!! Mexico is starting to look better and better every day.

[Anonymous]

FHA requires a down payment of 3% on their loans.  You can go on to fha website to find lenders within your area. I recently applied and approved for a FHA  loan and my pre-approval interest rate was at 6%. I think that rate is lower than most conventional mortgages right now, so you should be alright if you go for FHA financing. By the way FHA  rates my be going down soon being that the Feds just purchased all those bad mortgages.

[Anonymous]

I was wondering the same thing. I'm looking to buy in SoCal (first time homebuyer), and it would be *years* before I could have 20% down saved up, even for a cheap condo in a bad neighborhood. I talked to my ex-girlfriend, who's a real estate agent, and she's convinced that 97% conventional loans are still available. Countrywide was one lender she mentioned. I think if the loan is below FHA limits, though, FHA will probably be cheaper due to PMI being so expensive for conventional loans.

[Anonymous]

I sure hope lenders aren't requiring 20% down! I'll need to stay w/ my in-laws for years to save the 20%! I've talked to a few people and it seems like you can "try" for the 3%, but realistically 5% would be best....

jv

[demi]

There are still 3% FHA loans...I just did one.  The problem is the limits, depending on where you are in SoCal, you might not be able to find something within the limit...

[Anonymous]

I'm looking in San Fernando Valley.  There are plenty of houses that are below the 729k, or are you talking about the 417k limit?  I was under the impression that the new limit was going to be 625k after the first of the year....

jv

[Anonymous]

there are still some 90% programs that are conventional and 95% subsidized programs (CalHFA) in So Cal, but FHA is the best option with little money down.  Also, Cal HFA is being very restrictive in lending right now.  Also, alot of it depends upon the local market.  If it is in serious decline, etc.  Underwriters are terrified of the declining markets and high LTV.  In general, expect to put an extra 5 % down on declinign markets at the minimum.  Also, the CALHFA programs ahave creidt (min 620 mid) and income limits.  For example, a 4 person household must make under 74400 or so per year.depending upon the local market (that quote was for Riverside county)