bostonbubble.com Forum Index bostonbubble.com
Boston Bubble - Boston Real Estate Analysis
 
 FAQFAQ   SearchSearch   MemberlistMemberlist   UsergroupsUsergroups   RegisterRegister 
 ProfileProfile   Log in to check your private messagesLog in to check your private messages   Log inLog in 

 
Go to: Boston real estate bubble fact list with references
More Boston Bubble News...
DISCLAIMER: The information provided on this website and in the associated forums comes with ABSOLUTELY NO WARRANTY, expressed or implied. You assume all risk for your own use of the information provided as the accuracy of the information is in no way guaranteed. As always, cross check information that you would deem useful against multiple, reliable, independent resources. The opinions expressed belong to the individual authors and not necessarily to other parties.

What is the point of mortgage downpayment guidelines?

 
Post new topic   Reply to topic    bostonbubble.com Forum Index -> Greater Boston Real Estate & Beyond
View previous topic :: View next topic  
Author Message
Optimus4
Guest





PostPosted: Tue Mar 22, 2016 4:07 am GMT    Post subject: What is the point of mortgage downpayment guidelines? Reply with quote

This is more of a rant than anything else.

I lost a house recently to someone who bid over $20K over asking with 3% down. My bid was close to asking with 35% down.

3%! What the heck. Guidelines are that downpayments should be 20% but it seems like no one especially in this state follows them.
Back to top
Optimus4
Guest





PostPosted: Tue Mar 22, 2016 4:08 am GMT    Post subject: Re: What is the point of mortgage downpayment guidelines? Reply with quote

Oops I meant 25% down not 35%
Back to top
Guest






PostPosted: Tue Mar 22, 2016 11:44 am GMT    Post subject: Reply with quote

If I am the seller, why would I care about how much % the buyer put down as downpayment? Of course you should lose the bid when your bid is lower. The reality is when housing price going upward, the lending industry will start to loose up on loan standard, 3% down loan will get charged with higher interest rate, meaning more potential profit for the loaner.
This is 2006 housing bubble re_playing again. The irresponsible get awarded, the responsible get punished. Too bad as average joe, you and i have no vote to stop bail out when shit hits the fan back in 2008, as well as any similar acts in the future.
Back to top
Optimus4
Guest





PostPosted: Tue Mar 22, 2016 12:16 pm GMT    Post subject: Reply with quote

Seller has the right to accept the largest offer they get. I would to if I was in their position. The problem is the banks and mortgage companies who approve these loans.
Back to top
admin
Site Admin


Joined: 14 Jul 2005
Posts: 1798
Location: Greater Boston

PostPosted: Tue Mar 22, 2016 12:37 pm GMT    Post subject: Reply with quote

Anonymous wrote:
If I am the seller, why would I care about how much % the buyer put down as downpayment?


There is one reason. There's a higher chance of the mortgage falling through and the entire sale with it when the down payment is lower. An offer that is more likely to close is worth more, all other things being equal, so that would justify some premium.

- admin
Back to top
View user's profile Send private message Send e-mail Visit poster's website
Guest






PostPosted: Tue Mar 22, 2016 2:21 pm GMT    Post subject: Reply with quote

A large down payment (and 25% isn't that large) doesn't mean shit when financing is loose and sellers know that 3% loan is going to be approved. For fuck's sake, we're back to the instant approval days, with that Rocket app, or whatever the fuck it's called. Get ready to pay into another bailout in a few years.
Back to top
Richthofen



Joined: 02 Apr 2014
Posts: 68

PostPosted: Thu Mar 24, 2016 5:57 pm GMT    Post subject: Reply with quote

I guess if we're all reading a website called bostonbubble.com and we're still trying to buy anyways, competing with buyers using multiple bids, does that mean we're insane? I mean, we know there's a housing bubble by definition of this website but we're all still trying to buy a house. Jeez I need therapy, this housing bubble has made me certifiable.
Back to top
View user's profile Send private message
Guest






PostPosted: Thu Mar 24, 2016 6:07 pm GMT    Post subject: Reply with quote

Just because there's a bubble it doesn't mean that every single house is overvalued. I nearly closed on a place in Belmont at $39K under ask in January. And then I found another $50K of work at inspection and decided, fuck it. Soon after, some putz closed on that house $10K over my winning bid. He can have fun fixing the water issues, missing vapor barrier, and DIY wiring.
Back to top
Guest






PostPosted: Thu Mar 24, 2016 10:04 pm GMT    Post subject: Reply with quote

I think we just don't know which stage of the bubble we stand in. And some of us do really want to own a house some time in our lives.

A bubble also might not end up bursted, but deflated. And all the calculation and reasoning you gave yourself to wait for better price, might end up being destroyed by some QE acts.

Everyone just don't want to buy in on the top, and a lot of us really don't mind buying in half way to the top. That emotion makes you want to jump the fence and buy the house and get it over with. And after you did jump, you are just praying you are not the biggest fool that hold the bag last.

This is not crazy act, just simple consumer behaviors.
Back to top
Display posts from previous:   
Post new topic   Reply to topic    bostonbubble.com Forum Index -> Greater Boston Real Estate & Beyond All times are GMT
Page 1 of 1

 
Jump to:  
You can post new topics in this forum
You can reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot vote in polls in this forum


Forum posts are owned by the original posters.
Forum boards are Copyright 2005 - present, bostonbubble.com.
Privacy policy in effect.
Powered by phpBB © 2001, 2005 phpBB Group