House buying questions

20% will negate PMI. We put down 20% and spent another $20k the first year we had the house. We put up a new fence, found a leaky wall in the bathroom and opted to remodel the whole bathroom (since the whole shower had to be torn apart) at that point, and had to have our deck resurfaced or risk having to replace the whole deck. Obviously those weren't emergencies, but I'm glad we had the cash to do it.

You could also go look at open houses for older homes and newer homes. Then you can get an idea of what you like and what you don't like without feeling pressured.

I'm so terrified I don't have enough after the 20%. Ack I get all excited and comfortable with my timeline then get cold feet. And all my friends think I'm crazy because they did FHAs with 3.5% down.

We did an FHA at 3.5% and it's been challenging when it comes to the bigger projects (we still have our temporary fence in place 3 years after moving in lol) since even the 3.5% was tight, but the payments themselves are still very do-able. In your shoes I'd be tempted to put less down and put some of the 20% into a savings account for future projects.

We also did the 3.5% FHA, but we bought a foreclosure knowing it was going to need work.

The payments are FAR cheaper than renting anything except a hovel in the area, and we got acreage with our house. If we paid double our monthly mortgage payment now, we could pay the house off in less than ten years. Right now though, we're working on getting a cushion of savings built up and comfortable.

Honestly when my lender ran the numbers, FHA was going to cost me MORE than traditional loan.
Obviously I went with the traditional loan.

My maths are failing but how would an FHA cost more?

Buying a house here that is approx twice what my rental is worth will cost about the same for monthly payments as what I am paying now. and that's with < 20% down. Depressing thinking of all my money going into renting a crappy place.

FHA has a higher insurance premium, an annual premium associated with it (which NEVER go away for the life of your loan, and their premiums have been going up), additional closing costs, and other fees on top of that.

Here's a news story from this February on the subject:
http://articles.latimes.com/2013/feb/10/business/la-fi-harney-20130210

I didn't even know you could get conventional loans with <20%.

I clearly need to talk to mortgage people.

Absolutely - that's where PMI comes in! Conventional loans with PMI.

Ah ok. Getting everything confused.

It all starts making my head spin if I look at it too long.

You think you're confused? We close on our first home Thursday and, aside from knowing what it stands for, I have no idea what an FHA loan is or how it works. I also have never heard of PMI before this thread and I have no clue what kind of loan we are getting. I just know the loan officer said something in passing about it not being an in-house loan. After reading this thread I feel more lost than ever. Our loan officer never really told us anything about the loan other than our interest rate. Our only communication has been to fill out our loan app and he emails me when he needs paperwork. He never really explained anything to us and has never mentioned "PMI". Now I feel like I have no clue what's going on!! We are putting over 40% down, though.