FHA loans; why not?

[UCGal]

[quote=scaredycat]being able to walk away is worth something.

I need to buya house for reasons out of my control[/quote]

I’m assuming your wife is the reason out of your control.

Wouldn’t it be just as big a problem if you bought and walked… as far as marital harmony. She wouldn’t be happy with that, would she?

I’m assuming she’s looking for stability (or at least the false sense of it.) If you enter into the transaction with the idea that you’ll walk if the prices dip… that isn’t stability.

It’s kind of like getting married with the idea that if it’s not perfect you’ll just get divorced… it’s a bad way to enter the transaction.

[an]

[quote=CONCHO]Rent and keep your 20% down is still the best case scenario. Nothing like keeping your money liquid and your credit pristine, getting ready for a great opportunity.

If we have no or low inflation, that’s correct. However if we have high inflation your savings will erode and home prices will rise.

Government intervention in the housing market will only grow from here. Can you think of anything that the government gets out of once they get into it? Their interventions (both current and future) are going to cost money which will be paid for with Uncle Ben’s helicopter dollars.

What happened when government got involved in health care? Huge inflation in health care costs. Now that the government is increasingly getting involved in the housing market, what will you expect?[/quote]
How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

[an]

[quote=CONCHO]Rent and keep your 20% down is still the best case scenario. Nothing like keeping your money liquid and your credit pristine, getting ready for a great opportunity.

If we have no or low inflation, that’s correct. However if we have high inflation your savings will erode and home prices will rise.

Government intervention in the housing market will only grow from here. Can you think of anything that the government gets out of once they get into it? Their interventions (both current and future) are going to cost money which will be paid for with Uncle Ben’s helicopter dollars.

What happened when government got involved in health care? Huge inflation in health care costs. Now that the government is increasingly getting involved in the housing market, what will you expect?[/quote]
How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

[an]

[quote=CONCHO]Rent and keep your 20% down is still the best case scenario. Nothing like keeping your money liquid and your credit pristine, getting ready for a great opportunity.

If we have no or low inflation, that’s correct. However if we have high inflation your savings will erode and home prices will rise.

Government intervention in the housing market will only grow from here. Can you think of anything that the government gets out of once they get into it? Their interventions (both current and future) are going to cost money which will be paid for with Uncle Ben’s helicopter dollars.

What happened when government got involved in health care? Huge inflation in health care costs. Now that the government is increasingly getting involved in the housing market, what will you expect?[/quote]
How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

[an]

[quote=CONCHO]Rent and keep your 20% down is still the best case scenario. Nothing like keeping your money liquid and your credit pristine, getting ready for a great opportunity.

If we have no or low inflation, that’s correct. However if we have high inflation your savings will erode and home prices will rise.

Government intervention in the housing market will only grow from here. Can you think of anything that the government gets out of once they get into it? Their interventions (both current and future) are going to cost money which will be paid for with Uncle Ben’s helicopter dollars.

What happened when government got involved in health care? Huge inflation in health care costs. Now that the government is increasingly getting involved in the housing market, what will you expect?[/quote]
How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

[an]

[quote=CONCHO]Rent and keep your 20% down is still the best case scenario. Nothing like keeping your money liquid and your credit pristine, getting ready for a great opportunity.

If we have no or low inflation, that’s correct. However if we have high inflation your savings will erode and home prices will rise.

Government intervention in the housing market will only grow from here. Can you think of anything that the government gets out of once they get into it? Their interventions (both current and future) are going to cost money which will be paid for with Uncle Ben’s helicopter dollars.

What happened when government got involved in health care? Huge inflation in health care costs. Now that the government is increasingly getting involved in the housing market, what will you expect?[/quote]
How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

[blahblahblah]

How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

It’s not necessarily bad, it’s just that if we get inflation in home prices due to government interference/money printing/etc…, they will rise much faster than your savings since those prices are based on leveraged values. If you are a really good investor this might not affect you, but if you’re like me and lose money on every single investment you make, a house might be a safer bet in the high-inflation scenario. If you expect high inflation in asset prices, you might as well borrow as much money as possible right now and convert it to hard assets.

I wouldn’t advise anyone to walk away just because their house devalued 3.5%. The only reason I can think of for walking is losing your income and not being able to make the payments.

[blahblahblah]

How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

It’s not necessarily bad, it’s just that if we get inflation in home prices due to government interference/money printing/etc…, they will rise much faster than your savings since those prices are based on leveraged values. If you are a really good investor this might not affect you, but if you’re like me and lose money on every single investment you make, a house might be a safer bet in the high-inflation scenario. If you expect high inflation in asset prices, you might as well borrow as much money as possible right now and convert it to hard assets.

I wouldn’t advise anyone to walk away just because their house devalued 3.5%. The only reason I can think of for walking is losing your income and not being able to make the payments.

[blahblahblah]

How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

It’s not necessarily bad, it’s just that if we get inflation in home prices due to government interference/money printing/etc…, they will rise much faster than your savings since those prices are based on leveraged values. If you are a really good investor this might not affect you, but if you’re like me and lose money on every single investment you make, a house might be a safer bet in the high-inflation scenario. If you expect high inflation in asset prices, you might as well borrow as much money as possible right now and convert it to hard assets.

I wouldn’t advise anyone to walk away just because their house devalued 3.5%. The only reason I can think of for walking is losing your income and not being able to make the payments.

[blahblahblah]

How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

It’s not necessarily bad, it’s just that if we get inflation in home prices due to government interference/money printing/etc…, they will rise much faster than your savings since those prices are based on leveraged values. If you are a really good investor this might not affect you, but if you’re like me and lose money on every single investment you make, a house might be a safer bet in the high-inflation scenario. If you expect high inflation in asset prices, you might as well borrow as much money as possible right now and convert it to hard assets.

I wouldn’t advise anyone to walk away just because their house devalued 3.5%. The only reason I can think of for walking is losing your income and not being able to make the payments.

[blahblahblah]

How is holding your cash and great credit bad in that scenario. Inflation doesn’t spike over night. When you see inflation going up at full tilt, you can put that 20% and great credit to good use and buy a house at that time. It’s still much safer than buying w/ FHA now w/ an intention of walking away if the 3.5% down get wiped out. Which, IMHO, is very likely.

It’s not necessarily bad, it’s just that if we get inflation in home prices due to government interference/money printing/etc…, they will rise much faster than your savings since those prices are based on leveraged values. If you are a really good investor this might not affect you, but if you’re like me and lose money on every single investment you make, a house might be a safer bet in the high-inflation scenario. If you expect high inflation in asset prices, you might as well borrow as much money as possible right now and convert it to hard assets.

I wouldn’t advise anyone to walk away just because their house devalued 3.5%. The only reason I can think of for walking is losing your income and not being able to make the payments.

[an]

CONCHO, I didn’t mean to keep the 20% in cash in a high inflation period. I totally agree with you that in high inflation period, it’s pretty safe to buy a house. It’s just that, we’re not in a high inflation period right now and scaredycat is thinking about buying now w/ FHA and walk if he becomes upside down. Which is 3.5%. Which, I think is likely to happen if he buys now. Right now is not a time to speculate in a house that is also your primary resident. Especially if you have a screen name of scaredycat.

[an]

CONCHO, I didn’t mean to keep the 20% in cash in a high inflation period. I totally agree with you that in high inflation period, it’s pretty safe to buy a house. It’s just that, we’re not in a high inflation period right now and scaredycat is thinking about buying now w/ FHA and walk if he becomes upside down. Which is 3.5%. Which, I think is likely to happen if he buys now. Right now is not a time to speculate in a house that is also your primary resident. Especially if you have a screen name of scaredycat.

[an]

CONCHO, I didn’t mean to keep the 20% in cash in a high inflation period. I totally agree with you that in high inflation period, it’s pretty safe to buy a house. It’s just that, we’re not in a high inflation period right now and scaredycat is thinking about buying now w/ FHA and walk if he becomes upside down. Which is 3.5%. Which, I think is likely to happen if he buys now. Right now is not a time to speculate in a house that is also your primary resident. Especially if you have a screen name of scaredycat.

[an]

CONCHO, I didn’t mean to keep the 20% in cash in a high inflation period. I totally agree with you that in high inflation period, it’s pretty safe to buy a house. It’s just that, we’re not in a high inflation period right now and scaredycat is thinking about buying now w/ FHA and walk if he becomes upside down. Which is 3.5%. Which, I think is likely to happen if he buys now. Right now is not a time to speculate in a house that is also your primary resident. Especially if you have a screen name of scaredycat.

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