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re: How screwed am I by not putting down 20% on a home purchase?
Posted on 7/29/16 at 5:44 pm to HailToTheChiz
Posted on 7/29/16 at 5:44 pm to HailToTheChiz
I'm closing Tuesday. I did conventional and 5% down, 30yr fixed.
My (ideal) plan is to pay extra on it to get rid of the PMI quicker. PMI is an additional $175 on the mortgage per month, so that is something you could definitely live without (saving $2100 a year!).
I'd say go with the 5% down and pay off PMI. If it is a condo/townhome and you don't plan on living there in 15 years, you could always keep it as a rental. If you did this, I'd get rid of the PMI quick and start saving money towards your next purchase.
My (ideal) plan is to pay extra on it to get rid of the PMI quicker. PMI is an additional $175 on the mortgage per month, so that is something you could definitely live without (saving $2100 a year!).
I'd say go with the 5% down and pay off PMI. If it is a condo/townhome and you don't plan on living there in 15 years, you could always keep it as a rental. If you did this, I'd get rid of the PMI quick and start saving money towards your next purchase.
1
Posted on 8/1/16 at 8:14 am to tigerbaittrick
quote:
I'm closing Tuesday
Congrats bro
OP, I'll echo a lot of the responses here and advise going with 5% down, conventional loan. That is the route I went, and I have been paying extra and finally reached 22% equity last week to get rid of PMI after 3 years and 2 months.
You only need to put 1.5% more down than FHA. Just pay extra and PMI will automatically go away at 22% and you won't need to go through a whole refinance. After living in my house just over 3 years, I think it has been a better financial decision than renting, and especially considering the 7-10% appreciation in my area during that time frame (though that's not something I would count on).
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