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How'd you get your down payment?

1671 Views 22 Replies 14 Participants Last post by  deberosa
Coming up with a down payment is hard, especially the first one. I thought it might be helpful to tell how people have come up with them.

I bought my first house when I was 20 years old. My husband, baby and I moved in with my mother for 8 weeks to help save the money. At that time, interest rates were around 15%. We found a seller, with an assumable loan for 12%. Assuming the loan lowered our closing costs and also got us a better interest rate.

I have also bought three houses by drawing on or liquidating (due to change of employment) my 401K. I always maxed out my contributions to the 401K (20-25% I think). I hardly missed the money because of the tax difference and it adds up quickly. The penalties for withdrawing the funds were offset by the tax savings of buying the house.

I have sold houses to people without much down payment by letting them assume my loan or doing a lease with option to buy.

That is how I have done it.

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Good point RAC about the amount of mortgage to borrow. I think the going rate is that you can supposedly afford to spend 40% of your income on a house payment. NOT!

I've never bought a home that cost as much as I was approved for. I didn't feel I could afford a mortgage that high, so I didn't buy a house that expensive. I budgeted an amount I felt comfortable with.

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