According to a study by the senior research economist at the Federal Reserve Bank of Cleveland last week, homeownership is more sustainable for people with larger down payments. Really? We had to pay for a study to learn this? A homeowner who puts 3.5% down has 16.5% less equity than a homeowner who put 20% down. Of course, they are more likely to default! The study goes on to reveal that homeowners who supply down payments start out with equity. Really? Wow. Also, we learned that subsidizing the mortgage rate is not very beneficial either. While this is also not a surprise, it does highlight an important point. If the homeowner falls on hard times, a slightly lower interest rate will NOT usually make the home affordable enough to keep. It would seem the point of the study was to determine which was more effective, down payment assistance or interest rate subsidies. The winner of course was down payment assistance. Call me old-fashioned, but what about renting until you save a down payment? What about evaluating the total cost of homeownership to make sure you can afford to own a home? I think people forget that there is nothing wrong with renting a house. You don't have to own a house to make it your home. In fact, homeowners who are upside down do not really own their home either. Homeownership requires equity. What many homeowners "own" today is debt. Call it tough love, but sometimes its better to recreate a dream than to save yesterday's dream. When we faced tough times, we had to sell our dream home. We rented for several years before recreating our dream and buying another one. It's not easy. It's an emotional decision. Today's homeowners did not anticipate the recession or crisis when they bought their home or refinanced it several years ago. Tough times happen. This purchase turned into something resembling a new car purchase. I bet all of us found ourselves buried in negative equity after a new car purchase and wished we would have leased instead! The important thing to remember is that you have choices. There are programs and strategies available to allow homeowners to either save their dream or recreate their dream, depending on their individual situation and goals.