Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
The OP said, and I quote: I don't have enough for 20% down payment To me, that implies there is money for a down payment, just not enough for the 20% to avoid PMI...
Also, not having enough to cover the 20% doesn't mean the current income can't comfortable carry the house.
Your thoughts on that?
Well if 70k is less than 20% then they are looking into a house over 350k. Except for certain markets that is no starter home.
I would find it very surprising if someone who is OK taking 70k from his/her parents is in great financial shape. I hope these parents are rich and not cashing out their retirement to help the children.
Here's my situation: I've given money to my parents in the past which they really didn't need, but they saved that money for rainy days and have made good investment where they've enough to give me when I need help with my downpayment... the only reason I want the downpayment help is to avoid PMI... I could easily save the entire downpayment within a year, but I don't think I want to wait a year cause I've found a house that I want for the price I want with the interest rate 5% APR... that's hard to beat.. that's why I'm rushing into things and asking my parents for downpayment help... my income will alone qualify if I buy the house with 10% down and go with the FHA loan with higher interest rate, but I don't want to do that... the other reason I'm short in cash was I just moved to a different state and had to sell the house I owned for lot less that what I paid for... partly cause I didn't have anyone there to maintain it and I didn't want to have the burden of the mortgage... so, in a sense, I lost lot of my savings in that house... also, the house I'm buying will have a PITI of 30% of our income, which I think is manageable... the whole reason for this gift is the timing -- the house I want is on sale for the price I want and the interest rate is great... hope that answers some of the questions... thanks for all ur input.
Well if 70k is less than 20% then they are looking into a house over 350k. Except for certain markets that is no starter home.
I would find it very surprising if someone who is OK taking 70k from his/her parents is in great financial shape. I hope these parents are rich and not cashing out their retirement to help the children.
This makes some presumptions that could be incorrect. They also could be accurate but I can see where the OP could be doing just fine because I am in the same boat.
I could easily make the monthly payments on a $350k home but accumulating the huge chunk for the 20% down payment (in order to avoid PMI), paying for moving costs and having a six to twelve month cushion would take a very long time because I live in a high cost of living area and you can't save as much per month.
Here's my situation: I've given money to my parents in the past which they really didn't need, but they saved that money for rainy days and have made good investment where they've enough to give me when I need help with my downpayment... the only reason I want the downpayment help is to avoid PMI... I could easily save the entire downpayment within a year, but I don't think I want to wait a year cause I've found a house that I want for the price I want with the interest rate 5% APR... that's hard to beat.. that's why I'm rushing into things and asking my parents for downpayment help... my income will alone qualify if I buy the house with 10% down and go with the FHA loan with higher interest rate, but I don't want to do that... the other reason I'm short in cash was I just moved to a different state and had to sell the house I owned for lot less that what I paid for... partly cause I didn't have anyone there to maintain it and I didn't want to have the burden of the mortgage... so, in a sense, I lost lot of my savings in that house... also, the house I'm buying will have a PITI of 30% of our income, which I think is manageable... the whole reason for this gift is the timing -- the house I want is on sale for the price I want and the interest rate is great... hope that answers some of the questions... thanks for all ur input.
Ok, sorry for assuming the wrong thing. Can you document the money you gave them in the past? That way you can say it was a loan you made to them and they are repaying you. That may help with any gift tax issues.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
