Can we afford a home w/o down payment?

Question

We, I mean my girlfriend, mother and myself buy a home if we don't have money for a down payment. My g/f and I make about 63,000+ annually alone. My mother is a retired psychologist but she gets her retirement pay and works part time in the city during the school year about $40/hr part time. We don't necessarily have any real money towards a down payment. We are currently renting an apartment and my mother has her own apartment as well. Should we even try to go to a real estate agent? Never lived in a house b/f so any info is welcomed. Thanks. We live in NY by the way.

Answer 1

you will need a small down payment of 2.75% for an F.H.A but if i were you i would look in to geting a grant if your in new york county of suffolk look up the suffolfk county constdum in hauppauge on the 15 floor of the lee dennison building they give $15,000 to hundreds peple a year

good luck

Answer 2

I doubt you are going to manage with low income and no money, you just will not be able to afford anything.

You need to wait until you can cut the apron strings and support yourself without Mommy.

Answer 3

You really need to have something to put down.  I’m sure some people will come in and tell you there are grants and down payment assistance programs, and there may be, but if you really want own, you should be prepared in the event you don’t qualify for those programs. Your best bet at this point is to talk to several lenders (yes, you want a buyer’s agent, but they can’t help you with financing) and see what your options are.

This is how lenders see it: Someone who can’t save even enough for a down payment probably doesn’t have an emergency fund, i.e. money to cover unexpected expenses and that you could live off should you be unable to work for some time. So if you suddenly need a $2,000 plumbing repair or get sick and have no income for two months, where are you going to get the money to cover your expenses if you have nothing saved? For a lender, the worry is that you wouldn’t pay your mortgage and/or you’d skimp on taking care of your house…and that house is their collateral on the loan so if it goes into disrepair, it could wind up being worth less than you owe.

Answer 4

It depends on a lot of other things. How much is the house you're looking to buy? What is your FICO score? Do you have any other assets? How long have you been working for the same company?

Lenders used to do 80/20 loans for people with no downpayment. This was actually 2 loans. One for 80% of the purchase price, the second for 20% of the purchase price (with a much higher interest rate). With the state of current Real Estate market, I'm not sure if they still do this. I believe they want to see you put some sort of downpayment towards the purchase. (Ideally 20%)

I think working with a Real Estate Agent would be a good idea. They will know current market conditions, help you find the kind of house you're looking for, and assist you with the all the paperwork involved.

Good luck!

Answer 5

I'm sure there would be someone out there willing to give you a loan with no money down but there's a common misconception out there that owning a home is better because you're "not paying someone else" - in reality, with no money down you're probably paying more costs monthly and large part of it to the bank in interest costs.   Your costs to pay for mortgage/utilities/taxes/maintenance etc. will probably be more than your rent.  

Without knowing your particular situation, I suspect you may be better off to continue renting an apartment and saving up the difference between what you'd be paying in rent and what it would cost you to live in a house towards a downpayment of some sort.  It doesn't sound like you have a lot of breathing room here and if something happened to either you or your girlfriend.... at least you'd have a bit of a nest egg and wouldn't lose your house.