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You won't have to pay PMI: By making a larger down payment, you can also avoid paying private mortgage insurance (PMI). With a smaller down payment -- say 3.5% -- your mortgage lender will want some financial insurance that you'll pay the larger loan off on time, and in full. That increases the monthly mortgage payments you'll make if you make a smaller down payment - and that's a problem a homebuyer who makes a 20% down payment doesn't have.
Deciding whether you want to buy a house involves taking a good, hard look at its structure and its features, but there are many other topics that are every bit as important to your purchase. You might want to consider having a home inspection to flush out hidden problems, or even talk to the neighbors to get firsthand opinions of the neighborhood.

Real estate agents are important partners when you’re buying or selling a home. Real estate agents can provide you with helpful information on homes and neighborhoods that isn’t easily accessible to the public. Their knowledge of the home buying process, negotiating skills, and familiarity with the area you want to live in can be extremely valuable. And best of all, it doesn’t cost you anything to use an agent – they’re compensated from the commission paid by the seller of the house.
The loan-to-value ratio is basically defined as the percentage of the home's value you owe after making a down payment on a new home. It's calculated by taking the mortgage loan amount and dividing it by the appraised value of the house you're buying. So if you're buying a house that costs $100,000, you put down $10,000 and you're borrowing $90,000, your LTV ratio is 90 percent.
Founded in 1976 to provide independent brokerages with a powerful marketing and referral program for luxury listings, the Sotheby's International Realty network was designed to connect the finest independent real estate companies to the most prestigious clientele in the world. Sotheby's International Realty Affiliates LLC is a subsidiary of Realogy Holdings Corp. (NYSE: RLGY), a global leader in real estate franchising and provider of real estate brokerage, relocation and settlement services. In February 2004, Realogy entered into a long-term strategic alliance with Sotheby's, the operator of the auction house. The agreement provided for the licensing of the Sotheby's International Realty name and the development of a full franchise system. Affiliations in the system are granted only to brokerages and individuals meeting strict qualifications. Sotheby's International Realty Affiliates LLC supports its affiliates with a host of operational, marketing, recruiting, educational and business development resources. Franchise affiliates also benefit from an association with the venerable Sotheby's auction house, established in 1744.
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Each mortgage lender (LendingTree is just one example) will scrutinize your financial background—such as your debt-to-income ratio and assets—and use this info to determine whether to loan you money, and what size monthly payment you can realistically afford. This will help you target homes in your price range. And that's good, because a purchase price that's beyond your financial reach will make you sweat your mortgage payment and puts you at risk of defaulting on your loan.

Typically, you have to put between 3 and 20 percent of your home’s sale price down in cash to qualify for a conventional loan (30-year fixed mortgage), but there are exceptions. If you meet eligibility guidelines, you might qualify for a home loan with a zero-down payment through Veterans Affairs (VA loans) or the Department of Agriculture (USDA loan) programs.


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Or better yet, decide how much you’re willing to pay. Just because you can qualify for a larger mortgage doesn’t mean you want to have that kind of payment each month. Use the mortgage affordability calculator to help determine what you can afford. Now is also a good time to research your housing market and start going to open houses in your prospective neighborhood to give you a good sense of what your money will get you.
Down payments also protect buyers from negative equity if the market suffers a downturn. If you put 3 percent down and the market value of the home soon falls by 5 percent, you’ll be upside down on your mortgage by 2 percent; you’ll owe more than what the house is worth. However, if you had put down 20 percent, then you’ll still have equity in the home. A substantial down payment to reduce negative equity risk is not only attractive to lenders, but is also helpful in the event that owners need to sell the home for some reason.
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Pre-approval requires the lender to pull the credit information (see Step 1) and assess your financial situation. The lender will then give you a letter that states the amount they would be willing to lend you. If you get in a multiple-offer scenario, being pre-approved may give you an edge because the seller will have more confidence that you will be approved for a loan large enough to purchase their home.

You won't have to pay PMI: By making a larger down payment, you can also avoid paying private mortgage insurance (PMI). With a smaller down payment -- say 3.5% -- your mortgage lender will want some financial insurance that you'll pay the larger loan off on time, and in full. That increases the monthly mortgage payments you'll make if you make a smaller down payment - and that's a problem a homebuyer who makes a 20% down payment doesn't have.


Oh, and did we mention the Los Angeles weather? With year-round high temperatures that rarely dip below 70 degrees Fahrenheit, it's safe to say that in LA, it's nearly always a great day for a trip to the beach. The only problem you'll have is choosing which beach to go to. Would you prefer the carnivalesque atmosphere of the Santa Monica pier? Or maybe you'd like to experience the vibrant local color of Venice beach? If you're feeling swanky, put on your best designer swimsuit and spend the day sunning on Manhattan Beach. The choice is yours. And speaking of choices, when it comes to real estate, Los Angeles homes for sale truly have it all. Whether you're seeking to purchase an affordable starter home in an up-and-coming neighborhood, an immaculately restored historical bungalow, a mid-century masterpiece or a chic, modern mansion, the city of LA has just what you're after. Not quite ready to buy? No problem. You'll also find plenty of apartments for rent in Los Angeles in our rentals section, ranging from affordable to opulent. Great places go fast in LA, though, so make sure you have your checkbook ready. The world-famous Los Angeles lifestyle is waiting for you.
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