Portal Forum General General Discussion Home Ownership Reply To: Home Ownership

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@gopheritall wrote:

@gopherguy06 wrote:

@dxmnkd316 wrote:

I still stand firmly behind the principle that if you can’t afford 20%, you can’t afford the home.

In geneal, I agree, but not always the case. In most cases people who want to purchase a home may not have a ton saved up but can afford a monthly. Your income will increase over time and be able to afford it. Not always the case, but doesn’t always make sense to do 20% down

I would also argue that earning equity in a home beats paying rent, even if you also pay PMI. Even the small amount earned during the initial payments. You get nothing back out of rent.

As I understand it, going forward if your home value increases you can have it assessed and if your equity passes the 20% threshold you can have PMI removed. The 20% is not based on the value at purchase but the current value.

That’s true about the PMI…but I’m guessing you have to pay for an appraisal to get it removed. At any rate, yes earning equity beats paying rent. Except if you don’t gain equity and go upside down instead of right side up. There were many many people who bought high in ’04,’05, ’06, and ’07, just ahead of the market gutting. Many people lost their homes. Even more got some of their life savings gutted. I can guarantee if you ask any one of them they’ll telling renting ain’t such a bad thing. :wink:

I’ve owned several homes, and in each case if I make an honest accounting of what I put into the place – closing costs, insurance, interest, maintenance, realtor fees, inspections, appraisals, property taxes, services (not to mention free labor) etc. – I didn’t exactly clean up on any of them. I’ve heard about people in California who buy a house and sell it when the price doubles or triples…..I’ve heard about people winning the lottery, too. :wink: