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|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
personalfinance | mb1rly | I want to gauge whether we should even bother looking right now, at least until things calm down. Are there bidding wars with new construction homes? | Every house we've put an offer on has had multiple people forgo inspections to beat us out. Is this the norm or have we just been unlucky? | 5f0260f6d2f54f6283a502131955c0f8 | 2c63853984554d32a77c1cd6bfe30815 | 1,616,518,581 | 1,616,518,677 | 4 | 12 | Don't buy right now unless you have to for some reason. We are currently in an asset bubble that looks to be on the verge of collapse. After the moratorium on evictions and foreclosures is lifted and resolved in ~2 years there will be more inventory and the prices will stabilize. My girlfriend just sold her house after owning for three years and netted 100k and is now renting. If you can wait, you should, otherwise you could find yourself upside down on your mortgage (house is worth less than you owe).
| If its the house you want, book a second appt and bring a inspector. Then you can bid without the inspection condition.
| 0 | 0.066667 | 96 | 3 | 1 |
personalfinance | mb1rly | I want to gauge whether we should even bother looking right now, at least until things calm down. Are there bidding wars with new construction homes? | Every house we've put an offer on has had multiple people forgo inspections to beat us out. Is this the norm or have we just been unlucky? | 5f0260f6d2f54f6283a502131955c0f8 | 0d2cbcdf94be414c8241fec174901164 | 1,616,518,581 | 1,616,518,899 | 4 | 14 | Don't buy right now unless you have to for some reason. We are currently in an asset bubble that looks to be on the verge of collapse. After the moratorium on evictions and foreclosures is lifted and resolved in ~2 years there will be more inventory and the prices will stabilize. My girlfriend just sold her house after owning for three years and netted 100k and is now renting. If you can wait, you should, otherwise you could find yourself upside down on your mortgage (house is worth less than you owe).
| In Seattle buyers offer $100k+ easily over asking. It took me a while to get a house. I finally lucked out.
| 0 | 0.043478 | 318 | 3.5 | 1 |
personalfinance | mb1rly | I want to gauge whether we should even bother looking right now, at least until things calm down. Are there bidding wars with new construction homes? | Every house we've put an offer on has had multiple people forgo inspections to beat us out. Is this the norm or have we just been unlucky? | 5f0260f6d2f54f6283a502131955c0f8 | 9761136a3b57448fb0d53eb96089e2d1 | 1,616,518,581 | 1,616,519,674 | 4 | 11 | Don't buy right now unless you have to for some reason. We are currently in an asset bubble that looks to be on the verge of collapse. After the moratorium on evictions and foreclosures is lifted and resolved in ~2 years there will be more inventory and the prices will stabilize. My girlfriend just sold her house after owning for three years and netted 100k and is now renting. If you can wait, you should, otherwise you could find yourself upside down on your mortgage (house is worth less than you owe).
| If I was sitting on a house with serious issues, and was of questionable character, now would be the time I’d be selling it and accepting the offer where someone waived their inspections. You know there are most definitely people out there taking advantage right now.
| 0 | 0.078431 | 1,093 | 2.75 | 1 |
personalfinance | mb1rly | I want to gauge whether we should even bother looking right now, at least until things calm down. Are there bidding wars with new construction homes? | Every house we've put an offer on has had multiple people forgo inspections to beat us out. Is this the norm or have we just been unlucky? | 5f0260f6d2f54f6283a502131955c0f8 | 145d46ede96a4902bc4a7b50d1619198 | 1,616,518,581 | 1,616,527,306 | 4 | 16 | Don't buy right now unless you have to for some reason. We are currently in an asset bubble that looks to be on the verge of collapse. After the moratorium on evictions and foreclosures is lifted and resolved in ~2 years there will be more inventory and the prices will stabilize. My girlfriend just sold her house after owning for three years and netted 100k and is now renting. If you can wait, you should, otherwise you could find yourself upside down on your mortgage (house is worth less than you owe).
| Last time real estate was this tight the Realtor our friends were using got an inspector they could hire for the day. They did the inspection while viewing the house. That allowed them to waive inspection but still have some good insight if the house was crap or not. But you are outlaying $$$ for that day.
| 0 | 0.036364 | 8,725 | 4 | 1 |
personalfinance | mb1rly | I want to gauge whether we should even bother looking right now, at least until things calm down. Are there bidding wars with new construction homes? | Every house we've put an offer on has had multiple people forgo inspections to beat us out. Is this the norm or have we just been unlucky? | 2c63853984554d32a77c1cd6bfe30815 | 0d2cbcdf94be414c8241fec174901164 | 1,616,518,677 | 1,616,518,899 | 12 | 14 | If its the house you want, book a second appt and bring a inspector. Then you can bid without the inspection condition.
| In Seattle buyers offer $100k+ easily over asking. It took me a while to get a house. I finally lucked out.
| 0 | 0.090909 | 222 | 1.166667 | 1 |
personalfinance | mb1rly | I want to gauge whether we should even bother looking right now, at least until things calm down. Are there bidding wars with new construction homes? | Every house we've put an offer on has had multiple people forgo inspections to beat us out. Is this the norm or have we just been unlucky? | 2c63853984554d32a77c1cd6bfe30815 | 145d46ede96a4902bc4a7b50d1619198 | 1,616,518,677 | 1,616,527,306 | 12 | 16 | If its the house you want, book a second appt and bring a inspector. Then you can bid without the inspection condition.
| Last time real estate was this tight the Realtor our friends were using got an inspector they could hire for the day. They did the inspection while viewing the house. That allowed them to waive inspection but still have some good insight if the house was crap or not. But you are outlaying $$$ for that day.
| 0 | 0.137931 | 8,629 | 1.333333 | 1 |
personalfinance | mb1rly | I want to gauge whether we should even bother looking right now, at least until things calm down. Are there bidding wars with new construction homes? | Every house we've put an offer on has had multiple people forgo inspections to beat us out. Is this the norm or have we just been unlucky? | 0d2cbcdf94be414c8241fec174901164 | 145d46ede96a4902bc4a7b50d1619198 | 1,616,518,899 | 1,616,527,306 | 14 | 16 | In Seattle buyers offer $100k+ easily over asking. It took me a while to get a house. I finally lucked out.
| Last time real estate was this tight the Realtor our friends were using got an inspector they could hire for the day. They did the inspection while viewing the house. That allowed them to waive inspection but still have some good insight if the house was crap or not. But you are outlaying $$$ for that day.
| 0 | 0.1 | 8,407 | 1.142857 | 1 |
personalfinance | mb1rly | I want to gauge whether we should even bother looking right now, at least until things calm down. Are there bidding wars with new construction homes? | Every house we've put an offer on has had multiple people forgo inspections to beat us out. Is this the norm or have we just been unlucky? | 9761136a3b57448fb0d53eb96089e2d1 | 145d46ede96a4902bc4a7b50d1619198 | 1,616,519,674 | 1,616,527,306 | 11 | 16 | If I was sitting on a house with serious issues, and was of questionable character, now would be the time I’d be selling it and accepting the offer where someone waived their inspections. You know there are most definitely people out there taking advantage right now.
| Last time real estate was this tight the Realtor our friends were using got an inspector they could hire for the day. They did the inspection while viewing the house. That allowed them to waive inspection but still have some good insight if the house was crap or not. But you are outlaying $$$ for that day.
| 0 | 0.081081 | 7,632 | 1.454545 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | dc188966964e46cba0b6d39d46af3b21 | 1,458,137,668 | 1,458,144,751 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| 0 | 0.142857 | 7,083 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 51ac922d227c4c0dbe0539e22b97b49f | 1,458,137,668 | 1,458,147,392 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 9,724 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 5e435c7b592e48a284d5602e979710ad | 1,458,137,668 | 1,458,148,615 | 6 | 26 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.129032 | 10,947 | 4.333333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 1b2c8c7dce314b1780a4ac2feaeb2713 | 1,458,137,668 | 1,458,151,479 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 13,811 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | b084e25eedbc4acd8501866854e73dc2 | 1,458,137,668 | 1,458,151,611 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 13,943 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 7021013652e64ea0997b28e5582a4242 | 1,458,137,668 | 1,458,153,176 | 6 | 26 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.129032 | 15,508 | 4.333333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 096b88cbc4b34281a8b46afc7377540d | 1,458,137,668 | 1,458,153,675 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 16,007 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | a75a03e4e24a4b9e904f0e300ef15502 | 1,458,137,668 | 1,458,153,721 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| 0 | 0.142857 | 16,053 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | c7ddfc8e1cc24f4794a5e31659febe35 | 1,458,137,668 | 1,458,155,533 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 17,865 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 8fda83c4962a42afa76c12b8b1e2c30c | 1,458,137,668 | 1,458,158,471 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| as many are saying consider closing costs
but also know that similar to a 30yr fixed rate mortgage, putting 20% down is generally a suggestion not a requirement
| 0 | 0.1 | 20,803 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 1c13cb0623df4dc38aac605d3678b5d9 | 1,458,137,668 | 1,458,159,367 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 21,699 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 1af327b80ba142f88c887ad11495c42b | 1,458,137,668 | 1,458,160,405 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 22,737 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 88ac9e8e43074442b217083531d07c31 | 1,458,137,668 | 1,458,165,386 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 27,718 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 6890964a4ff94fb79be4a2421242e411 | 1,458,137,668 | 1,458,165,982 | 6 | 23 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| The down payment is put towards the cost of the home before the mortgage goes into effect, you start out owing $160K on your $200K home.
This shows the bank that your serious, and leverages their risk, since if you never made the first payment, they've already got $40K in equity in the house when they take it back from you.
This leveraged risk will convince them to offer you the loan, and results in a lower interest rate (high risk, use high interest to offset risk).
| 0 | 0.127273 | 28,314 | 3.833333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 870ea17108a740309e83d976c4264136 | 1,458,137,668 | 1,458,167,488 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 29,820 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | f384e10ec3df4a4ab3ee0a1bdbb6f79e | 1,458,137,668 | 1,458,169,486 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 31,818 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 05f5d7852e664aa5ae9d2042e1b87f59 | 1,458,137,668 | 1,458,169,558 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 31,890 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | ca63b6c80ed3467fa11304343414833c | 1,458,137,668 | 1,458,191,712 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 54,044 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 071277d47dc24a5ab30f54e6a9f0a914 | 1,458,137,668 | 1,458,199,198 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 61,530 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 7d21a9e88f4c4c26a0fe55d1a3fb80ce | 1,458,137,668 | 1,458,214,039 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 76,371 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 8caf349c7e2645eba370331b223f641c | 1,458,137,668 | 1,458,224,665 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 86,997 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | c1b3fe661bc7435ab0b557a6541fd193 | 91c06e672c3a4af9a4dc9cd07281fb1d | 1,458,137,668 | 1,458,426,611 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 288,943 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | dc188966964e46cba0b6d39d46af3b21 | 1,458,137,816 | 1,458,144,751 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| 0 | 0.142857 | 6,935 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 51ac922d227c4c0dbe0539e22b97b49f | 1,458,137,816 | 1,458,147,392 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 9,576 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 5e435c7b592e48a284d5602e979710ad | 1,458,137,816 | 1,458,148,615 | 6 | 26 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.129032 | 10,799 | 4.333333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 1b2c8c7dce314b1780a4ac2feaeb2713 | 1,458,137,816 | 1,458,151,479 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 13,663 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | b084e25eedbc4acd8501866854e73dc2 | 1,458,137,816 | 1,458,151,611 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 13,795 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 7021013652e64ea0997b28e5582a4242 | 1,458,137,816 | 1,458,153,176 | 6 | 26 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.129032 | 15,360 | 4.333333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 096b88cbc4b34281a8b46afc7377540d | 1,458,137,816 | 1,458,153,675 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 15,859 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | a75a03e4e24a4b9e904f0e300ef15502 | 1,458,137,816 | 1,458,153,721 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| 0 | 0.142857 | 15,905 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | c7ddfc8e1cc24f4794a5e31659febe35 | 1,458,137,816 | 1,458,155,533 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 17,717 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 8fda83c4962a42afa76c12b8b1e2c30c | 1,458,137,816 | 1,458,158,471 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| as many are saying consider closing costs
but also know that similar to a 30yr fixed rate mortgage, putting 20% down is generally a suggestion not a requirement
| 0 | 0.1 | 20,655 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 1c13cb0623df4dc38aac605d3678b5d9 | 1,458,137,816 | 1,458,159,367 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 21,551 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 1af327b80ba142f88c887ad11495c42b | 1,458,137,816 | 1,458,160,405 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 22,589 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 88ac9e8e43074442b217083531d07c31 | 1,458,137,816 | 1,458,165,386 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 27,570 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 6890964a4ff94fb79be4a2421242e411 | 1,458,137,816 | 1,458,165,982 | 6 | 23 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| The down payment is put towards the cost of the home before the mortgage goes into effect, you start out owing $160K on your $200K home.
This shows the bank that your serious, and leverages their risk, since if you never made the first payment, they've already got $40K in equity in the house when they take it back from you.
This leveraged risk will convince them to offer you the loan, and results in a lower interest rate (high risk, use high interest to offset risk).
| 0 | 0.127273 | 28,166 | 3.833333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 870ea17108a740309e83d976c4264136 | 1,458,137,816 | 1,458,167,488 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 29,672 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | f384e10ec3df4a4ab3ee0a1bdbb6f79e | 1,458,137,816 | 1,458,169,486 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 31,670 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 05f5d7852e664aa5ae9d2042e1b87f59 | 1,458,137,816 | 1,458,169,558 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 31,742 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | ca63b6c80ed3467fa11304343414833c | 1,458,137,816 | 1,458,191,712 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 53,896 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 071277d47dc24a5ab30f54e6a9f0a914 | 1,458,137,816 | 1,458,199,198 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 61,382 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 7d21a9e88f4c4c26a0fe55d1a3fb80ce | 1,458,137,816 | 1,458,214,039 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 76,223 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 8caf349c7e2645eba370331b223f641c | 1,458,137,816 | 1,458,224,665 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 86,849 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | b9ebc62f8a204cac965fb07c22db6e3f | 91c06e672c3a4af9a4dc9cd07281fb1d | 1,458,137,816 | 1,458,426,611 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 288,795 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | dc188966964e46cba0b6d39d46af3b21 | 1,458,141,359 | 1,458,144,751 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| 0 | 0.142857 | 3,392 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 51ac922d227c4c0dbe0539e22b97b49f | 1,458,141,359 | 1,458,147,392 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 6,033 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 5e435c7b592e48a284d5602e979710ad | 1,458,141,359 | 1,458,148,615 | 6 | 26 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.129032 | 7,256 | 4.333333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 1b2c8c7dce314b1780a4ac2feaeb2713 | 1,458,141,359 | 1,458,151,479 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 10,120 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | b084e25eedbc4acd8501866854e73dc2 | 1,458,141,359 | 1,458,151,611 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 10,252 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 7021013652e64ea0997b28e5582a4242 | 1,458,141,359 | 1,458,153,176 | 6 | 26 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.129032 | 11,817 | 4.333333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 096b88cbc4b34281a8b46afc7377540d | 1,458,141,359 | 1,458,153,675 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 12,316 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | a75a03e4e24a4b9e904f0e300ef15502 | 1,458,141,359 | 1,458,153,721 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| 0 | 0.142857 | 12,362 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | c7ddfc8e1cc24f4794a5e31659febe35 | 1,458,141,359 | 1,458,155,533 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 14,174 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 8fda83c4962a42afa76c12b8b1e2c30c | 1,458,141,359 | 1,458,158,471 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| as many are saying consider closing costs
but also know that similar to a 30yr fixed rate mortgage, putting 20% down is generally a suggestion not a requirement
| 0 | 0.1 | 17,112 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 1c13cb0623df4dc38aac605d3678b5d9 | 1,458,141,359 | 1,458,159,367 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 18,008 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 1af327b80ba142f88c887ad11495c42b | 1,458,141,359 | 1,458,160,405 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 19,046 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 88ac9e8e43074442b217083531d07c31 | 1,458,141,359 | 1,458,165,386 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 24,027 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 6890964a4ff94fb79be4a2421242e411 | 1,458,141,359 | 1,458,165,982 | 6 | 23 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| The down payment is put towards the cost of the home before the mortgage goes into effect, you start out owing $160K on your $200K home.
This shows the bank that your serious, and leverages their risk, since if you never made the first payment, they've already got $40K in equity in the house when they take it back from you.
This leveraged risk will convince them to offer you the loan, and results in a lower interest rate (high risk, use high interest to offset risk).
| 0 | 0.127273 | 24,623 | 3.833333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 870ea17108a740309e83d976c4264136 | 1,458,141,359 | 1,458,167,488 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 26,129 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | f384e10ec3df4a4ab3ee0a1bdbb6f79e | 1,458,141,359 | 1,458,169,486 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 28,127 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 05f5d7852e664aa5ae9d2042e1b87f59 | 1,458,141,359 | 1,458,169,558 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 28,199 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | ca63b6c80ed3467fa11304343414833c | 1,458,141,359 | 1,458,191,712 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 50,353 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 071277d47dc24a5ab30f54e6a9f0a914 | 1,458,141,359 | 1,458,199,198 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 57,839 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 7d21a9e88f4c4c26a0fe55d1a3fb80ce | 1,458,141,359 | 1,458,214,039 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 72,680 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 8caf349c7e2645eba370331b223f641c | 1,458,141,359 | 1,458,224,665 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 83,306 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | a9797bf6469742b0bf758143befa1653 | 91c06e672c3a4af9a4dc9cd07281fb1d | 1,458,141,359 | 1,458,426,611 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 285,252 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | dc188966964e46cba0b6d39d46af3b21 | 1,458,143,750 | 1,458,144,751 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| 0 | 0.142857 | 1,001 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 51ac922d227c4c0dbe0539e22b97b49f | 1,458,143,750 | 1,458,147,392 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 3,642 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 5e435c7b592e48a284d5602e979710ad | 1,458,143,750 | 1,458,148,615 | 6 | 26 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.129032 | 4,865 | 4.333333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 1b2c8c7dce314b1780a4ac2feaeb2713 | 1,458,143,750 | 1,458,151,479 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 7,729 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | b084e25eedbc4acd8501866854e73dc2 | 1,458,143,750 | 1,458,151,611 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 7,861 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 7021013652e64ea0997b28e5582a4242 | 1,458,143,750 | 1,458,153,176 | 6 | 26 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.129032 | 9,426 | 4.333333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 096b88cbc4b34281a8b46afc7377540d | 1,458,143,750 | 1,458,153,675 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 9,925 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | a75a03e4e24a4b9e904f0e300ef15502 | 1,458,143,750 | 1,458,153,721 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| 0 | 0.142857 | 9,971 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | c7ddfc8e1cc24f4794a5e31659febe35 | 1,458,143,750 | 1,458,155,533 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 11,783 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 8fda83c4962a42afa76c12b8b1e2c30c | 1,458,143,750 | 1,458,158,471 | 6 | 7 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| as many are saying consider closing costs
but also know that similar to a 30yr fixed rate mortgage, putting 20% down is generally a suggestion not a requirement
| 0 | 0.1 | 14,721 | 1.166667 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 1c13cb0623df4dc38aac605d3678b5d9 | 1,458,143,750 | 1,458,159,367 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 15,617 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 1af327b80ba142f88c887ad11495c42b | 1,458,143,750 | 1,458,160,405 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 16,655 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 88ac9e8e43074442b217083531d07c31 | 1,458,143,750 | 1,458,165,386 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 21,636 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 6890964a4ff94fb79be4a2421242e411 | 1,458,143,750 | 1,458,165,982 | 6 | 23 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| The down payment is put towards the cost of the home before the mortgage goes into effect, you start out owing $160K on your $200K home.
This shows the bank that your serious, and leverages their risk, since if you never made the first payment, they've already got $40K in equity in the house when they take it back from you.
This leveraged risk will convince them to offer you the loan, and results in a lower interest rate (high risk, use high interest to offset risk).
| 0 | 0.127273 | 22,232 | 3.833333 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 870ea17108a740309e83d976c4264136 | 1,458,143,750 | 1,458,167,488 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 23,738 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | f384e10ec3df4a4ab3ee0a1bdbb6f79e | 1,458,143,750 | 1,458,169,486 | 6 | 27 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.091549 | 25,736 | 4.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 05f5d7852e664aa5ae9d2042e1b87f59 | 1,458,143,750 | 1,458,169,558 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 25,808 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | ca63b6c80ed3467fa11304343414833c | 1,458,143,750 | 1,458,191,712 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 47,962 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 071277d47dc24a5ab30f54e6a9f0a914 | 1,458,143,750 | 1,458,199,198 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 55,448 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 7d21a9e88f4c4c26a0fe55d1a3fb80ce | 1,458,143,750 | 1,458,214,039 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 70,289 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 8caf349c7e2645eba370331b223f641c | 1,458,143,750 | 1,458,224,665 | 6 | 51 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.052632 | 80,915 | 8.5 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | e2654759f7d2441ca26094eb2dfcd035 | 91c06e672c3a4af9a4dc9cd07281fb1d | 1,458,143,750 | 1,458,426,611 | 6 | 42 | $40k down payment + $160k mortgage.
But you might also get hit with a variety of taxes and other fees too, so make sure you have some money set aside for that.
(My 20% down payment + 80% mortgage did not include another $10k in taxes and another $2k in misc fees from lawyers etc.)
| At closing, you show up with your $40,000, and the bank wires the $160,000 from your loan to the title company. The title company then pays off the seller's mortgage, if any, pays the realtors, then gives what's left to the seller.
| 0 | 0.1 | 282,861 | 7 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | dc188966964e46cba0b6d39d46af3b21 | 51ac922d227c4c0dbe0539e22b97b49f | 1,458,144,751 | 1,458,147,392 | 7 | 51 | Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.172414 | 2,641 | 7.285714 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | dc188966964e46cba0b6d39d46af3b21 | 5e435c7b592e48a284d5602e979710ad | 1,458,144,751 | 1,458,148,615 | 7 | 26 | Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| math is off. you get a 160k mortgage if you're putting 40k down on a 200k house.
| 0 | 0.035714 | 3,864 | 3.714286 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | dc188966964e46cba0b6d39d46af3b21 | 1b2c8c7dce314b1780a4ac2feaeb2713 | 1,458,144,751 | 1,458,151,479 | 7 | 51 | Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| Don't forget to account for closing costs! You are going to want to save around 23% of the house value.
| 0 | 0.172414 | 6,728 | 7.285714 | 1 |
personalfinance | 4anq7z | I want to buy a house, probably in the next few years. I've been told I need to put in a down payment of about 20% of the cost.
How does that actually work?
For example, I want to buy a 200k house, I save (with much effort) 40k cash, then pay the seller what I have and pick up get a 140k mortgage? Get a 200k mortgage, and immediately pay the bank that 40k? | 20% down? | dc188966964e46cba0b6d39d46af3b21 | b084e25eedbc4acd8501866854e73dc2 | 1,458,144,751 | 1,458,151,611 | 7 | 27 | Please don't forget about closing costs. Depending on the agreement, the seller might pay all the costs, or you might split 50-50. It all depends. So, the amount you pay to the title company will be 20% downpayment + closing costs - earnest money.
| You want a house for $200k.
You go to a mortgage company / bank / CU / etc etc and say I would like this house for $200k please. Mortgage people check out your finances to make sure you can afford it and will approve or deny.
You write an offer to sell, assume they accept, now you're moving forward. You get inspections, etc etc, and appraisal. If the house doesn't appraise out you may have trouble depending the lender / market trends. If the house appraises at $180k, the lender generally won't finance that $20k difference, that is on you to make up... on top of the down payment. But lets assume it appraises at $200k, so you're all good.
Now as closing approaches your downpayment + mortgage loan is sent to the seller to pay off their note (or for them to pocket as cash if they owe nothing). Assuming no liens on the property the title is signed over to you. Now the seller has no loan and no house. You have a house and loan.
.... now much to the dismay of /PF, you don't *need* 20%, but it makes the most sense because you avoid PMI (mortgage insurance). This is another monthly payment on top of everything else that is in place to protect the lender from you walking away from the loan/house and sticking them with something that could be worth less than you owe. 5-19% down means you can get a conventional loan, you pay your PMI and normal payment until you hit 20% equity in the home. Then the PMI drops off. <5% means FHA loan, this sucks the worst because the PMI rate is WAY higher and in NEVER leans the loan. In some situations it could make sense, but probably only if you plan on buying - flipping - getting out of the house ASAP... the lack of down payment could free up cash to flip the home and you move on. So if you only have a loan on it for 6 months, its not that big of a deal.... but that PMI for 30 years would be awful.
My first place was a condo, we put 8% down .... had PMI which was ~$95/mo. on our $175k mortgage. HOA + mortgage + HO6 + PMI was still less than the rent I was
| 0 | 0.095588 | 6,860 | 3.857143 | 1 |
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