Quote:
Originally Posted by JasonCSU
I don't disagree with the data from the last 10 years showing more delinquency on loans with less than 20% down, but how does that automatically make someone 4 times more likely to default if they do put less than 20% down? Like I said in my previous example, someone could have the full 20%, though only put 10% down to keep the other 10% on hand.
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I think the real point is that the stats/facts show that people who put low down payments, or don't have enough for 20% down and reserves tend to let their notes become delinquent at a higher rate.
Sure, there could be someone who puts 5% down, and then takes his other money and invest it elsewhere, and is perfectly fine. But that's simply anecdotal, the statistics show the opposite happens more often than not. I'm not someone who makes conclusions based on someone on the internet saying "it can work!", I want to see proof in the form of reliable and trustworthy statistics, and guess what? Those statistics shows that low down payment loans default at a very high rate.
It's one of the reasons I was able to predict FHA would be in trouble last year, and it's one of the reasons I know FHA delinquency will continue to rise.