[quote=esmith]I think you’re conflating three issues. 1) Can you get a mortgage with 10% down? 2) Will the bank agree to sell you the house with 10% down? 3) Is it wise to start shopping for a house if you only have enough money for 10% down?

1) Yes, but it will be more expensive than if you put 20% down. [/quote]
Thanks, esmith!

That depends, of course, – in the sense that if one has more than 10% to put down, and if he prefers to invest some of it, instead of putting everything for a downpayment, it may actually pay off, or at least be a safer investment, in case the prices drop further (which looks almost a certainty right now).

[quote=esmith]
(…)
3) Probably not – houses are still going down – it’s possible that your house will drop 10% and wipe your down payment. Don’t spend your last dime on the down payment.[/quote]

No, I wouldn’t spend my last dime, and probably I wouldn’t be getting a good loan deal if I did. But saving another 10% down payment or 50-60K may take years and years, realistically (in my case). In the mean time, with kids, it’s nice to have a larger house & yard while they are still young. I didn’t mean that I would buy something right away, but perhaps in the next year or two – hopefully by then the prices would have reached their last/bottom leg in areas I am looking.