- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
re: Is it always best to put 20% down on a house to avoid PMI?
Posted on 11/20/20 at 9:33 am to pioneerbasketball
Posted on 11/20/20 at 9:33 am to pioneerbasketball
I was not expecting this to be such a heated debate!
It’s pretty simple math, as another poster said, to analyze what your total cost is going to be of putting the extra money down vs. not.
What’s not simple is determining your risk tolerance and how much you could be making off of that money in other investments.
I used to be in the “pay debt off quickly if able, put the 20% down” group. Now I’ve shifted to “let the leverage and debt work for me, just don’t get overextended”. Where is “overextended”? That’s a great question with a host of different answers.
Congrats on being in this situation, regardless. It sounds like you’ve been working hard and have your head in a good place if you’re trying to learn these things so early!
It’s pretty simple math, as another poster said, to analyze what your total cost is going to be of putting the extra money down vs. not.
What’s not simple is determining your risk tolerance and how much you could be making off of that money in other investments.
I used to be in the “pay debt off quickly if able, put the 20% down” group. Now I’ve shifted to “let the leverage and debt work for me, just don’t get overextended”. Where is “overextended”? That’s a great question with a host of different answers.
Congrats on being in this situation, regardless. It sounds like you’ve been working hard and have your head in a good place if you’re trying to learn these things so early!
1
Posted on 11/21/20 at 11:08 am to Decisions
quote:
just don’t get overextended”. Where is “overextended”? That’s a great question with a host of different answers.
Excellent observation.
Given his age, I’ll guess that if/when wifey and kiddo come along, this won’t be the “forever” house. So the PMI (which is just throwing money away) may not be a long term detriment. And even if he does hang onto the house longer term, with a reasonable downpayment + appreciation, he may be able to get out if it soon enough anyway.
But as you accurately pointed out, it’s a balancing act. And I would view the PMI as the cost of having access to the cash that he’s not putting down.
Page 1 of 1
Popular
Back to top
Follow TigerDroppings for LSU Football News