"ZERO DOWN!"

[trof]

The first time I saw that come-on in a TV commercial about mortgage borrowing I though "WHOA! NOTHING down?"

That ain't the way it works.
If a buyer doesn't have to put up 10% of the price of the house, or at least 5%, where's their stake in the whole thing?
Nowhere, that's where.

We bought our first house in the early 70s.
I think the price was around $35,000.
OK, I borrowed the 5% down payment from my granny.
And I paid her back within 3 years.
We got an FHA loan at 7%.

ZERO DOWN is a fool's game.
ZERO EQUITY going in is not good.
Not for you and not for your lender.

And now the chickens have come home to roost.

[billyoc]

1. Interest Only Mortgages. They're my personal favorites.

:rofl:

[Venceremos]

2. Our neighbors gone of those

bragged about it endlessly, as if they were the smartest people on earth for taking such a mortgage. Having heard any bragging lately, though.

[Hangingon]

3. A ned residential addition near me still adertises "Zero Down"

It is a brand new sign. I don't know what their deal is. Crazy!

[monmouth]

4. I remember as a kid in the late '40s, people going to church to

pray that they would get the mortgage they had applied for. This is after the war, but I'm talking about people who did not serve and did not have the GI bill. Anyway, people filled out their paperwork, dressed up (I mean, shirts, ties, suits, etc.) to go to the bank to be interviewed for their mortgage. I kid you not, and then they had to wait until the bank board met once a month and then wait for the call to see if they got their mortgage. It was a time of celebration and quite a feather in ones cap. Mortgages were very difficult to get, you had to work for them.

[trof]

5. I was a kid in the late 40s too.

When I (We!) got our first mortgage in the early 70s I thought "MY GOD! WHAT HAVE I JUST DONE? I'VE SIGNED OUR LIVES AWAY!"

I later became more comfortable with this almost uniquely 'American' way of doing business.
:shrug:

[monmouth]

6. That's funny, I got my (we) first mortgage in the early 70's and

was on the phone that morning of the closing needing it explained again about the money transfers, etc. I had buyer's remorse until I moved in, then all was fine. It's a very scary thing to go through. I have friends who buy and sell all of the time, I just couldn't do it.

[SoCalDem]

9. The morning we were to close on our first house, they called and said

"you're going to need a little more money for the closing".."Bring a cashier's check for $1845.00".. I sat down and cried.. we had ZERO money left after scraping together the down payment.. Lucky for us, that my dear sweet aunt DROVE 150 miles to bring us that money so we could close at 3PM that afternoon..

[monmouth]

10. Oh god, that was my fear, we were tapped also. Very scary stuff..n/t

[rucky]

7. Even landlords require a deposit. n/t

[SoCalDem]

8. When we finally did a re-fi..back in '02, I collected 3 year's worth of tax forms, gathered

my husband's pay stubs for a year.. paper-clipped a year's worth of bank statements..BEFORE I ever made a phone call..

A friend gave me the phone number of the ooutfit they went through.. They basically TRIED to give us $160K cash out..(we only wanted 23,500..to re-roof, new AC, some concrete & a few renovations)..(we've been in the house since 1982)..

I was expecting them to set an appointment for us.. Instead, she said..when can you sign the papers? we'll send someone out..

We met at Denny's, signed the papers and the next day a courier brought us our check for $23,500..

I was flabberghasted..

We got a new loan for 5.35% ...30-yr fixed..


times have surely changed:(

[Blarch]

11. I took a zero down loan..

on a $350,000 house. Remodeled it for 10,000 and sold it for 480,000...all within two years.

Best thing I ever did.

"zero down is a fools game" ...call me a fool, all the way to the bank.

[Dukkha]

12. i did zero down

on a 82500 condo locked in at 5.0%
problem is now I got married and desperately need more room and it's been impossible to sell. after 18 months I gave up and took it off the market for a while.