Just something I've been curious about...When someone finances a really expensive house, lets say 2M, how is that usually done? Is it like cheaper houses where it is most common to have 20% down or do lenders usually require much larger down payments? Are there more stringent requirements for reserves and DTI as well?
Scottsdale,AZ | Jan 11th 2011
by owenz545
Answer
by CaPortf...
by nickheth
It depends on the area as well. In short it is like conventional financing however the loan to value tends to go down as well as the debt to income requirements go down as well. There are a variety of companies that will finance out side the box as well, some will even take pledged assets. Jan 11th 2011
by HLSInc
When it comes to financing really expensive properties, there are some guidelines (such as mentioned by CaLoans) but a lot of it tends to be more common sense underwriting. For example, someone who is buying a $2 Million home may not be working at all. So they have no income per say. But if they are a trust fund baby that has a billion dollars in the bank, no one is going to care about the DTI. They will typically require at least 20% down payment. But the more you want to borrow, the more you will need in down payment. (will be a factor of your credit, but not only the FICO score, but your previous financings. So if this is your first $2 Mil home, they will be more strict then if it's your third). I guess what I am saying is that there is more grey area when you are talking about financing like that. Jan 11th 2011
by FundingNow
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