23109VC I never do loans so this is just my opinion ….but yes I do believe it will be harder to get no money down loans in a big way. Yeah these types of loans could very well disappear altogether. My advice, even if these types of loans did not go away would be to save money. I know that really makes breaking into the market difficult but the current high rates of defaults are the direct result of the past ridiculously easy lending standards. The bottom line is that many people who are defaulting had no business buying the homes in the first place. Many of them were duped by shiesters but in the end, they signed those loan docs. So the bottom line will most likely be to restore common sense to the industry. I know that sounds harsh but it really does make sense.

SD Realtor

I’ve obtained 2 homes using VA loans with 100% financing, but I’d be hesitant to do that for the next couple of years.

I heard just the other day that Countrywide had put out a notice internally not to go with any more zero down loans. I wish I could remember what L.A. station it was on so I could reference it.

Barnaby33,

“If you don’t have a down payment, you shouldn’t buy a house.”

Why do so many of you tie the notion of affordability and possesion of down payment together? They are not necessarily the same thing.

If my monthly budget allows me to pay $3,100/month on rent/mortgage, that means I can afford a $400k loan (PITI @ 8% int).

Whether I have the good fortune of having $80k sitting in the bank makes no difference as to what I can afford to pay.

What having the $80k for a down pmt DOES mean is I can buy a house for $480k rather than $400k. Down payment or not, I still have a $400k mortgage & I still have the same $3,100 check to pay each month.

Maybe 10 years ago when you could buy a starter home here for $150k, saving $30k was not to unreasonable, but expecting every first-time buyer to come to the table w/ $100k is just absurd.

I guess the point is that if we hadn’t deviated from good sense lending standards like the 20% down pmt deal, we would not be in this mess, and thus would not have to come up a six-figures down. But here we are – and some of us still want to own a home.

“Sense of entitlement” – really? You sound so damn pompous. If you are in a position to save that kind of $$ and have done so, good for you. Here’s your freakin’ cookie.

Americans have the worst saving habits on planet earth

With that said, I have been saving 50% of my income toward a down payment and hopefully in a few years I can score a great deal on a nice condo or home in San Diego.

Cooking meals and eating out less saves a lot of cash!

I see maybe 2-3 movies a year which saves as well.

I do not drink alcohol except rare times. Saves money.

Heck I even am waiting on a plasma big tv to save until plasma tv prices get a lot cheaper. So far they are dropping in prices. I remember when a 60 inch plasma tv cost 20k. Now a top plasma big 60 inch tv sells for 5-10k.

Cars- people overspend this too. Mine is paid off and yes its a BMW but still not bad to maintain every year. I want a new one but thats to wait several years as well. Once loans default people will probably sell their Lexus and BMW at fire sale prices to pay off their home to avoid losses.

I think that given the sky-high prices in California, most buyers are in the Alt-A or subprime segments.

I believe that 100% financing is here to stay. Some lenders will take the risk for the right interest rate or up-front closing costs (whether paid by buyer or seller).

The mortgage business will become like the auto and credit card businesses where everyone can get financed. Do you remember when you needed a down-payment to buy a car, and leasing was only for business executives? Now everyone goes for the low payments.

Only the best credit risk customers will bet the best rates. Everyone else will pay more to defray the losses. So long as buyers only focus on monthly payments, then there’ll always be products to serve that segment. I believe that Interest-Only is how most people will buy houses in the future (interest-only and make principal payment whenever you’re in the mood). That’s the best scenario for the REIC so they can move more houses, and also the best scenario for the lenders because they can increase fees and transaction churn thus creating more profits.