Must be a first time home buyer. (Congratualtions) Banks require to make some downpayment, ustually 10 - 20% and do not make loans for 100%.
The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also avvo.com terms and conditions item 9, incorporated as if it was reprinted here.
Your decision will have significant impact on your tax liability and should be made in consultation with an accountant. The consultation should be a relatively simple matter, as it revolves entirely around your financial goals and "personality."
Ask yourself - do I think that real estate is the best investment I can make with my money or do I think that it has more potential to grow elsewhere. It's also highly relevant what you think is going to happen in the economy at large (nationally, here in California, etc.). Any attorney or person who purports to tell you that they know YOUR answer to that question, is to be avoided. You must inform yourself as to what is going on in the marketplace and then make YOUR choice on how to allocate your funds based upon your financial outlook, Nobody can predict with certainty what the economy will do or know, as you do, your tolerance for risk.
It's also relevant whether this is a home for owner occupancy or a home that you intend to rent to someone else. While I am betting that Mr. Doland's presumption is 100% correct, please understand that how much money you want to put into a property can depend upon your use of that property as it relates to your investment portfolio.
Bottom line: find professionals you trust, read and listen as much as you can, and make a decision that will allow you to sleep at night knowing you've done what YOU should do.
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This is not a legal decision, it is a personal finance decision. Talk to your accountant or financial advisor.
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