105% Financing, Lenders are Having Trouble Learning Their Lesson

Most of the lenders we deal with have typically said the same thing, "you'll be hard pressed to find anything under 90% financing (10% down)." Aside from FHA loans, which we have been seeing (making it possible to achieve near 100% financing, if you qualify). Granted these Freddie Mac and Fannie Mae loans have some strict pre-qualification standards, but whatever happened to the good old 20% down. Here in Pasadena, home prices are higher than the national average, and the cost of living is quite high as well, so people have trouble saving up for that down payment. That is understandable, but buyers need to take some of the responsibility here, and do their home work, make sure they can afford the property, and not over extend themselves. So yes, the 105% financing by these wonderful lending entities can be quite seductive, don't jump the gun, you might end up finding yourself where you never thought you would be, in default (Mortgages With No Money Down Still Available, Washington Post).

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