Healthy amount for a downpayment

[Networth]

I know this is variable but what would be considered a "healthy" "great" downpayment percentage? I have some numbers in my head but figure it never hurts to ask.

[StartingOver10]

This depends upon the loan type.

For example, if you are getting an FHA loan the minimum down payment is 3.5% so if you decide to put down 10% instead, that is considered a "compensating factor" and works to your advantage.

If you are getting a conventional loan with 20% down (conventional typically ranges from 5% down to 20% down), then putting down 25% or 30% is a compensating factor.

If you are looking for private financing the typical down payment is 35% to 40% and if you put down 50% the lender is pleased. But then, the whole loan type is a different animial altogether

What type of mortgage loan are you looking for now?

[Networth]

It would probably be a conventional. I am a bit ignore on the subject of mortage/loans to be honest. I don't think we would qualify for a FHA loan because of our incomes. What is the threshold or am I completly out of my depth on what the qualifications are lol. This wouldn't be for another 1-1.5 years but have already started saving and want to continue.

[Networth]

Than again our incomes will drop by quiet a bit for a year while I go back to school so maybe we would do FHA. 

[StartingOver10]

FHA is usually the easiest loan to qualify for with the lowest down payment.

You do have to have documentable income and the income that will be used must agree with your tax returns.

If you go to school and then graduate and get a job in your field, FHA can use the new income immediately after you graduate. That's a good thing.

[Networth]

Thanks for the info. Do we have to be making under a certain amount to qualify for a FHA loan? I am worried we make too much while I am working to qualify.

[avv7c0]

No cap on income to qualify, but there are caps on loan amounts. Varies by area, and you can find current limits online.

If you find a house that is more expensive than the limit for your area, you can always pay the difference in cash. That's what we did in order to do FHA on a house that would've been higher than our local limit at 3.5% down.

Also note that PMI is required for life of your loan if you do FHA, which conventional doesn't have.

[DallasLoanGuy]

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@Networth wrote:

Thanks for the info. Do we have to be making under a certain amount to qualify for a FHA loan? I am worried we make too much while I am working to qualify.

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no. fha has no income limits