100% finance for a house

[vsjhoc]

If only your name is on the loan, only your name should be on the title to the house.

[DebbieL]

Wait and save your money. I live in a very bad housing bubble area (Victoria, BC). Prices are insane at this time, but it will crash. I will wait for the fire sale before I buy. Let others go into debt over half a million for something that was $250K six years ago - not me. I will patiently wait for the bank to sell it for whatever they can get once these fools can't make payments. The average household income here is about 60k - it doesn't take a genius to figure out that an average house here shouldn't be selling for over $500K. This will end badly (but not for me).

One example of the insanity (stupidity) of the banks these days. I have a friend who hasn't worked since I've known her (15 years) and is a single mom with 2 young children. She has probably 80-100K in student loan debt, no job, her education is apparently useless for getting her any high paying work, etc. A year ago I had to talk her out of buying a townhome for over $300k. The bank said she could have the loan (she's very naive) so she was going to do it. Stupid. I work full time and I knew that even I couldn't have afforded that loan. The insanity is truly scary.

[disneysteve]

One example of the insanity (stupidity) of the banks these days. I have a friend who hasn't worked since I've known her (15 years) and is a single mom with 2 young children. She has probably 80-100K in student loan debt, no job, her education is apparently useless for getting her any high paying work, etc. A year ago I had to talk her out of buying a townhome for over $300k. The bank said she could have the loan (she's very naive) so she was going to do it.

I agree that what the banks are doing is nuts, but what shocks me even more is the people themselves. Your example is a perfect one. If this woman had no job and that much debt, why was she even out looking at 300K houses? What was she thinking?

My mom's house has been for sale since June. It has been under contract 4 times. The first two times fell through because the buyer couldn't get approved for a loan. Both times, I saw the offer and the buyers' financial statements and said right away that there was no way the people could afford the house. I have no idea why they even bothered putting in a bid, why the realtor took it seriously or why the bank pre-qualified them.

[Elgin526]

I agree, pay off the CC debt and save up a down payment. You don't need the full 20% that is usually recomended if you don't want to or can't wait that long, but you should put something down, at least.

100% loans can be risky, if your house goes down in value, you will wind up oweing more than it's worth, and then you're really stuck if you have to sell it in a hurry! Nothing like having to write a check at closing when you're selling a house! That happend to the seller of my first home purchase, he had to write a check for $10,000, so I've seen it happen first hand!

[Ima saver]

I think we have all agreed that you really need to look at a less costly house and save as much as possible for the down payment. You can always trade up in houses later.

[DebbieL]

I honestly don't know what she was thinking Steve. I've actually had to distance myself from her because the way she floats through life really gets on my nerves. She seems to have no clue, and doesn't learn from the past. She's 45 years old (almost 10 years older than me) and she has no common sense whatsoever. I think she really believes that because a realtor tells her something and is "friendly" he's telling her the truth. I laughed at that one. Of course he seems nice when he thinks he can sucker you into buying a house that is overpriced to begin with and you cannot afford! What does he care once he gets his commission?