S/O Borrowing for down payment

amother

Tangerine

Fri, Jan 29 2021, 3:09 pm

amother [ Forestgreen ] wrote:

I think it also depends what percent you are putting down. We put down 20%. I know many people who put down much, much less than 20% or nothing (somehow?!).

We're aiming for 10% and know we might not even pull that off. BH we're able to get a mortgage anyway.

amother

Pewter

Sat, Jan 30 2021, 7:03 pm

amother [ Copper ] wrote:

A guy in dhs kollel knocked on our door out of the blue and asked to borrow money towards a down payment.

I was FLOORED. And you know what? My dh welcomed him in, had a talk, and lent him $15,000!!!!

Dh said on of the greatest form of chesed is lending someone money so they can become financially stable and people do it all the time.

The man got cosigners, ehrlich people who agreed to pay the loan if he chas vshalom defaults.

It took me a bit to wrap my head around the idea and then I reminded myself, all the money I have right now has been lent to me by Hashem.

did he pay it back?

amother

Indigo

Sat, Jan 30 2021, 8:27 pm

People should not be judging others. Living in a tiny apartments with a bunch of kids and working hard for years trying to save up, only to afford a tree on ocean parkway is quite depressing! (Exaggerating)
If someone needs the money, and is asking to borrow must really need to borrow. Some people/many people do actually pay it back. Some people borrow all the time from others and never pay it back. This thread actually got me really upset!

amother

Seagreen

Sat, Jan 30 2021, 8:51 pm

A family member asked for money about 20,000 from my parents and never paid it back. They were reminded several times by their mother but have not paid it back or made any mention of it.
Meanwhile I am helping my parents with bills all the time.
I wish they would see that my parents need the money back.

amother

Brown

Sat, Jan 30 2021, 8:53 pm

amother [ Indigo ] wrote:

The problem is, a lot of people can't afford to lend out a large amount like that all at once.
Especially if they don't know for sure if they will get it back, or even just when.
I'm sure at the time the borrowers honestly mean to pay it back. But, life happens. You can't blame someone for not being willing to take that risk.

amother

Indigo

Sat, Jan 30 2021, 8:58 pm

I am not blaming. I feel like people here are judging others, "how dare people want to borrow so much money 15,000-100,000, 200,000? Buy what you can afford!"
People do not get it! You can make payment plans whether some money is paid back faster and some over 10 years. I do understand not lending the money if you can't 100%.

amother

Blonde

Sat, Jan 30 2021, 9:07 pm

amother [ Sienna ] wrote:

And mine was closer to 25k and that was over 5 years ago. Which is still very low, I just don't want people to get the idea that 7k is standard because it isn't.

We had to put down 5 percent.

amother

Mustard

Sat, Jan 30 2021, 9:30 pm

the issue is that a person has to disclose if they borrow money for a down payment and the mortgage company will make you "gift it" it's not a simple matter. I keep saying this.

A person also doesn't usually HAVE to live in an expensive place like Brooklyn.

You said yourself that people borrow and don't pay back, it's very risky to lend out large sums. I say this as someone who does lend out large sums but I still realize it's very risky and for a mortgage because of my first point I probably wouldn't.

amother

Olive

Sat, Jan 30 2021, 9:36 pm

I needed $70,000+ for my down payment 10+ yrs ago. I had enough in savings, but that is all my husband and I had in savings total at that time. If we bought, would have had no savings left for emergencies, repairs...etc. So, we ended up getting a $50,000 loan from our parents (which is paid back monthly), and my grandma surprised me with a $10,000 gift. The rest was from our savings.

amother

Amber

Sat, Jan 30 2021, 9:52 pm

Like many people, we used a combination. Both sets of parents gifted us very generously, which we were immensely grateful for. We also used a chunk of our savings. Our parents were happy we were buying when we did (during the crash in 09) and they felt it was a good time to invest. We would borrow from parents if need be but I can't think of anyone else we would borrow from.

amother

Seafoam

Sat, Jan 30 2021, 10:39 pm

amother [ Blonde ] wrote:

Our down payment was $7000. Come join us in Cleveland 🤣. We used our tax return and a few thousand in savings.

Wow, really??

amother

Peach

Sat, Jan 30 2021, 10:40 pm

We put down 125k Bh all by ourselves. Took us 5 years to save.
My parents promised us a 7k gift to use towards painting/ Reno work Thou it never came through.
Grateful we did it on our own. Completely on our own.

amother

Yellow

Sat, Jan 30 2021, 10:44 pm

Rappel wrote:

25k down payment... Ah me, that would be nice. Smile

Enjoy your home!

Not sure where you live but in most places that’s hardly a help and can maybe just cover a very small part of fixing up a place. Of course it’s very generous of whomever gave as a gift because that is a large sum to give another person but in the scheme of a mortgage and down payment and the fixing up most homes need that’s really not a lot of money and one would have needed to be saving a lot and working very hard to come up with the main money.

amother

Red

Sat, Jan 30 2021, 11:56 pm

We put down 20%. The downpayment and closing costs was 150k. My inlaws gave us 10k and my parents gave us 3k. 13k is not much but every penny helps! The rest of the money was all our hard earned work. We bought in the five towns. Housing is very expensive here and many people borrow for the down payment or get very nice gifts (50k+) gifts from parents.

Renting is putting money in someone else pocket. If your income is high enough to pay a mortgage and still have a little extra, it makes perfect sense to borrow IMHO. If lack of capital is not due to bad decision making but simply you weren't working enough years to have the savings, if you wait five years to get that extra 50k for the downpayment housing will have gone up even more.

amother

Lilac

Sun, Jan 31 2021, 1:04 am

amother [ Indigo ] wrote:

It sounds like you don’t get that loaning a lot of money to someone else is a really big deal. Sorry for your housing situation.

amother

Apricot

Sun, Jan 31 2021, 1:17 am

amother [ Copper ] wrote:

שלי שלך ושלך שלי, עם הארץ.

I'm not too impressed by someone who thinks that you owe him a loan. And it's not clear that a down payment for a house is exactly what Chazal mean when they talk about loaning money as a great mitzva.

It's a nice thing to help a friend. It really is.
Yet something is off when a friend feels entitled to money from your pocket.

amother

Chartreuse

Sun, Jan 31 2021, 1:59 am

Quote:

Wow. In Israel you can't buy a shed with that down payment

And for some of these other amounts you could buy just that. A shed.

We estimate that we'd need 500k sheckels or more to buy in our neighborhood, and we live in the center, but not in a major city.
We have about 60-70k saved. It's a nice emergency fund but it's not going to buy us an apartment any time soon. A gmach loan could maybe get us to 100k. If we took a private bank loan plus mortgage, our monthly payments would be crazy.

So we'll just keep renting ad saving what we can. And homes will keep going up, and so will rent. אין מה לעשות.

amother

Copper

Sun, Jan 31 2021, 2:59 am

amother [ Apricot ] wrote:

Where in the world do you see that he felt "entitled" to my money?

I live in a community where there is a gmach and chesed organizations everywhere. If chas vshalom something were to happen, I know my community would be there for me. Everyone contributes in the way that they can. He asked. Dh could've said no. Asking for help does not make youu entitled.

Teomima

Sun, Jan 31 2021, 3:47 am

Here's what I don't get about people borrowing for a down payment: if you've saved for a number of years and still can't afford the down payment, how do you expect to manage when you have both a mortgage and a loan to repay?