We propose our 30/30/3 rule for home buying and mortgages.

Basically, you need 30% of the value saved up for the house, spend no more than 30% of your gross monthly cash flow on your mortgage, and buy a house no more than 3X your gross income.

If you can follow these rules, you’ll be good and save responsible homeowners the pain of a housing meltdown like we’ve just had!

FS

However, there is a slight issue with one of the quotes from Dale. There’s a mention of how Quicken Loans works which is completely wrong. We are not, nor have ever been, a lead-generating company. Quicken Loans is a direct lender in all 50 states. We don’t sell leads or information EVER. In fact, all we do is home mortgages and it’s been that way for almost 25 years.

Yes, we are pioneers in automating the online mortgage process. No question about the online part – we’re America’s largest online lender, but we’re also the #5 retail lender in the US. Our clients never have to leave the comfort of their home – they can sign their application online and we’ll come to their home for the closing. But we don’t do that to generate leads – we do it to make it easier on our clients. We’ve spent a long time trying to create the easiest way to get a home loan.

Without tooting our horn too much, we’ve seen a lot of success helping America with their mortgages – we closed (directly funded ourselves) over $15 billion in loans in just the first half of 2009. And the people who know us best – our clients – rate us with over 94% satisfaction.

In most points, I agree with Dale. It is important to do the research and find the right mortgage and the right mortgage lender. I do wish she would have talked more about FHA loans – they’re some of the most flexible loans and even though people might not think FHA is for them, it can be a great option. It’s especially useful since home values aren’t what they used to be – FHA refinance loans allows loans up to 97.75% and as little as 3.5% down when purchasing.

If you have any questions, please feel free to contact me – Kelly@QuickenLoans.com
I just wanted to make sure the quote about us is cleared up. I’m a huge fan of your site personally and a very happy Twitter follower.

Thanks!

Kelly
Quicken Loans
Kelly@QuickenLoans.com
http://Twitter.com/QuickenLoans

I just closed on a first mortgage a week ago, and I had a very different experience from what Dale Siegel describes “all lenders” as doing. The bank (a regional bank in New York/New England) has a 10% down no-PMI mortgage available, with one interest rate for everyone who qualifies. Interest rate does not depend on the size of the down payment or on your specific credit score. We have good credit so I don’t know what the cut-off point to qualify would be.

In any case, my experience was clearly different from Ms. Siegel’s explanation of how “all lenders now work.”

I was really getting into the conversation about frugality and then I read this little blurb. True? Yes…but at what cost?