Zero cash-down would be fine if sweat equity were the real down-payment---providing a real equity cushion, and an enormously beneficial side-effect of teaching construction skills to home-owners---an economic flywheel to sustain them during periods in which their regular jobs disappear.
The Boston Globe <http://www.boston.com/news/globe/>
Zero-down mortgage initiative by Bush is hit
Budget office says plan likely to spur more loan defaults
By Chris Reidy, Globe Staff | October 5, 2004
Bush contends that reducing the required 3 percent down in the Federal Housing Administration mortgage program to zero down would help 150,000 first-time buyers in the first year. Homeownership rates are now about 69 percent nationwide, compared to about 64 percent 10 years ago. The FHA insures many private-lender home loans.
An unanswered question remains, he acknowledged: "We have no experience of how these loans will perform when the market is weak."
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