The Urban Institute recently released a new report that shows the metropolitan statistical areas (MSA) where people are making the lowest down payments when they are buying homes. In order to determine which MSAs spent the least on down payments, the Urban Institute examined the FICO scores of each of the areas as well as the LTV (loan-to-value) ratio in each of the areas.
Based of this combination of scores, the MSA where the lowest down payments are made is Detroit-Dearborn-Livonia, Michigan. A representative for the Urban Institute, Sheryl Pardo explained that this is all a reflection of the economy:
She adds that the Federal Housing Administration (FHA) “is an important player in those local communities,” because it is helping people get into housing in these challenged areas. “Economically, FHA is king. That’s who’s helping people get on the ladder to home ownership,”