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      07-16-2012, 04:02 PM   #48
MediaArtist
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Quote:
Originally Posted by 48Laws View Post
The delinquency regarding FHA loans isn't as cut and dry as you make it.
Oh really. Then what's the truth behind FHA delinquencies increasing 27%?

Quote:
Again, PMI is to offset the lack of equity in a new home which is something lenders want to safeguard. I recommend 3-15% down and the rest for emergency funds. Why throw all your money into a liability anyway? Bad advice. Lol
That makes no sense. PMI doesn't exist to "offset the lack of equity", it's a premium charged to cover the risk of a borrower defaulting on a high LTV loan which is guaranteed by FHA, and IMO, it isn't enough because FHA is still failing and severely insolvent. Paying 3% on a home and financing the rest simply doesn't work, it's as dangerous as the 0% loans that wiped out the sub-prime market. If 3% down worked, FHA would be solvent, and wouldn't be at risk of failing. There's a reason why the private lending industry won't do 3% down payments, it's because they know it doesn't work. If you can't afford 20% down, and reserve funds, then you should be looking at a smaller, or less expensive house. Your advice is absolutely horrible.
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Last edited by MediaArtist; 07-16-2012 at 04:14 PM.