Re: how do people have so much money in the bank??

i have no idea....if it weren't for us being qualified for the VA loan where you don't have to put anything down, it'd be hard on us...we have good savings, but it'd be hard to put that all towards a downpayment without feeling broke until we recoop'd some of it back.

Re: how do people have so much money in the bank??

we rented for two years saved a ton combined with wedding gift money and a sum of money that DH's parents took for rent when he was younger then invested and gave back to him.

Re: how do people have so much money in the bank??

My IL's just sold their house to an all cash buyer the 2nd day it was listed on CL. They live in Binghamton and I think these people were downsizing so that could be another circumstance. That actually also happened to my friend who had an apt in Riverdale and sold it almost right away for cash

Re: how do people have so much money in the bank??

It can happen. We are not rich by any means, but we put about 60% down on our current house, and we've never gotten a penny from family, never lived with family to save money, etc.

We bought our first house as newlyweds in 2002, did not have much of a down payment, put 10% down. Lived in that house for a few years, fixed it up quite a bit, doing a lot of the work ourselves when we could to save $$$. Meanwhile we lived on just DH's salary, saved all of mine. When the time came to trade up, the first house had gone up a lot in value, and we had saved quite a bit. It all added up to a really big down payment for the current house.

Re: how do people have so much money in the bank??

There are lots of reasons. DH and I lived off one salary and banked the other completely for about 5 years.

Some people make a lot of money.

My husband works for a small company that offers very low interest loans to employees if they want to put it towards a new home.

My cousin's wife got a huge settlement when her dad died in an accident while she was in high school.

Re: how do people have so much money in the bank??

We owned a coop for 5 years and banked my entire salary for that time and every bonus DH got. Then we sold the coop for a VERY nice profit. Essentially, we lived WELL BELOW our means for a long time.

Re: how do people have so much money in the bank??

between wedding money and stock options from my DH company that is how we came up with the 20% down. But there are plenty of people out there that can't. Just keep looking for a house. You will find the right seller and the right house. GL!

Re: how do people have so much money in the bank??

with with FHA loans a lot of people do not want to take them on when selling if they can opt for a conventional loan. With us we were turned down a lot because of it that is why we had to look for FSBO because they are not aware of the complications a FHA loan can present. But if your looking at mint conditioned houses i am not sure why anyone would turn you down. I mean its not like they will have to pay for repairs in order to pass the FHA requirements.

Or your other option is look for less of a house price so you maybe able to conventional loan because the DP would be less. I am not sure i know anyone who has put down 100K - i put down 20K on our house and that was around 5% but we have a handyman special.

Re: how do people have so much money in the bank??

My husband and I decided to stop paying someones elses mortgage so we moved into my sisters house. She has a finished basement with a bathroom. No kitchen. My husband and I share the basement with our 3 year old. It is like a large studio. We have been here since October and our bank account has increased soooooo much.
IF you have a chance to do something like this do it. Everyone thought we were crazy and would wind up killing each other but it actually brought my husband and I closer and my brother in law and my husband have become great friends.

It is hard and def a sacrifice but in the end we will have a house and it will be worth it.

Re: how do people have so much money in the bank??

Something seems fishy... Like this agent isnt looking out for your best interest... not sure why I feel that way... Guess bc I cant see losing 6 houses bc of a small DP...

We got an FHA loan... We would have qualified for a traditional as well, but FHA was just better for us after doing a whole bunch of calculations... We only put down 7%... basically 20k for us... And then needed an additional 10 for closing costs! We werent turned away, we were in a bidding war which we won without paying over the amt we were comfortable with... We left ourselves with a very small cushion since we knew we were getting the 8k credit plus some other credits we qualified for...

Something just doesnt seem right...

Re: how do people have so much money in the bank??

We put down 75K - we saved for a couple of years to do it (and only had one income, i'm a student). What we did was that we always saved our entire income tax refund and my DH's bonus. Another thing is that if you get a raise, live off your previous salary and take the increase in your pay and put it directly into savings. I think it depends on everyone's situation so you can't compare yourselves to others. I know we could have saved much more but enjoyed buying nice things and going out. Don't be discouraged, keep trying. Maybe try saving a little more, it's a tough market and people don't want to risk a deal falling through. I remember asking my realtor about FHA loans and he said some sellers don't like them bc we so little money put down with the contract, the would-be buyers don't have much to lose if they choose to walk away and so sometimes do.

Message edited 2/16/2010 12:06:29 PM.

Re: how do people have so much money in the bank??

Sacrificing and saving. We did it for 4 and a half years. In the end, we got our house because of our down payment. Our sellers had other offers, but we included 10% as a deposit with our contract (rather than the customer $1,000 deposit) and made other deposits throughout the process until we finally closed.

Re: how do people have so much money in the bank??

Re: how do people have so much money in the bank??

we paid for our own wedding so did not see much profit off that....we waited a year afterwards to start the house hunt. we put 3.5% down and are now working slowly on renovations. don't get yourself down! if you know what you can afford, the perfect home is out there. we also opened the doors to other towns even though we ended up in the area we wanted. keep looking and good luck!

Re: how do people have so much money in the bank??

We live well below our means (mostly) & we bank my entire salary. We also had some savings together from tax returns & wedding gifts.
I do anything to save money short of pushing a shopping cart of cans down the highway.

When I'm not in school I work double shifts until I'm about to collapse & so does DH.

It's hard but we have done really well.

Re: how do people have so much money in the bank??

We put down a large downpayment.

Dh had inherited some money & invested it & we cashed it out.

We also had some wedding money.

We had to put down a large downpayment though, b/c we were buying a co-op & we have relatively low incomes, so although we knew we could afford it, b/c we are not big spenders, we had tohave a certan debt to income ratio to be approved.

Re: how do people have so much money in the bank??

We had put 20% down. We just had our goal in mind and saved everything we could, no extras.

Re: how do people have so much money in the bank??

We currently rent, but we have a large amount saved/invested and plan to put down a significant down payment when we do buy down the road.

It's a combo of my parents paying for our wedding (allowing us to bank the gifts), DH and I receiving major scholarships for college and grad school (no student loans), and living way below our means. We've always lived on one salary until DH started his new job last week (although technically we're still on one salary since he won't be paid until March) and we've tried to find a balance between splurging on things we care about and maxing out 401k/saving/investing. We plan to bank all of my DH's paycheck and our tax refund. I'll probably work part time/reduced hours when we have kids so I'd rather not get used to an income we may not always have. We do spend a sickening amount on NYC rent, but sold our cars/no car expenses which helps balance it out.

Everyone's situation is so different, but here are some tips that work for us: track everything in quicken and set up a budget to follow, pay yourself first, spend on the stuff you care about and cut back where you don't care as much, learn to live on less and bank any extra money that comes your way

hopefully you will find a house that works out soon

Re: how do people have so much money in the bank??