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Message
20% down on a house or save your cash?
Posted on 9/17/21 at 2:04 pm
Posted on 9/17/21 at 2:04 pm
What is the boards consensus when it comes to purchasing real estate at these low interest rates?
20% down?
15% down?
3-5%
Depends on your situation?
20% down?
15% down?
3-5%
Depends on your situation?
9
Posted on 9/17/21 at 2:08 pm to tigersint
Depends on PMI. Mine is $25 a month. I put down 10%. Invested the rest i had saved up. Did pretty well over the last 1.5 years in that regard…
Posted on 9/17/21 at 2:25 pm to tigersint
"What is the boards consensus"
Doubt there is a consensus. An argument could be made for each of those three.
Doubt there is a consensus. An argument could be made for each of those three.
Posted on 9/17/21 at 2:34 pm to tigersint
Save the cash
Posted on 9/17/21 at 2:39 pm to tigersint
Yes, depends. Nuts and Bolts: If you're saving more than PMI and generating a return on those savings above your interest rate, it's viable. Personally, despite low interest rates, pay that shite down as fast as possible and tap on a HELOC if you really need the cash down the road.
Posted on 9/17/21 at 2:56 pm to tigersint
quote:
Depends on your situation?
I say this one. Market went up about 30% in a year. I think you would have been far better off with whatever down payment you had than waiting. Other markets maybe not. What's the long term trend, etc.
Posted on 9/17/21 at 3:40 pm to Teddy Ruxpin
PMI is like $20 in this case
Posted on 9/17/21 at 3:50 pm to tigersint
I put down 20 percent don’t regret it
Posted on 9/17/21 at 4:37 pm to tigersint
20% down is best to have a lower note and save on PMI.
If you prefer to keep the funds invested you can always re-appraise a year or two later and cancel the PMI if LTV is 80% or lower.
If you prefer to keep the funds invested you can always re-appraise a year or two later and cancel the PMI if LTV is 80% or lower.
Posted on 9/17/21 at 7:58 pm to dat yat
I would do 20% and save the remaining.
Posted on 9/17/21 at 8:40 pm to SDVTiger
quote:
Save the cash
Posted on 9/18/21 at 6:30 am to Paul Allen
Zero down is the perfect scenario......assuming you can get away without paying PMI (VA loan, etc.) PMI is a real drain on your monthly payment, so the answer is what ever the minimum is for your to meet your 80% loan to value. If you find a house that has enough equity in it when you buy it, you SHOULD be able to get away without paying PMI. If you look at the Principal, Interest, Tax and Insurance breakdown and then add PMI (~ 1% of loan / yr) to the mix you will be horrified by how little is applied to the principal monthly. The only saving grace currently is the interest rate.
I personally, am against having money / equity tied up in a house. That isn't everyone's philosophy, but it is mine; I want that cash working for me and not in equity (effectively cash buried in a jar in the yard).
I personally, am against having money / equity tied up in a house. That isn't everyone's philosophy, but it is mine; I want that cash working for me and not in equity (effectively cash buried in a jar in the yard).
Posted on 9/18/21 at 8:44 am to tigersint
With interest rates so low and inflation running hot, a long term fixed loan is like printing money.
Posted on 9/18/21 at 9:10 am to tigersint
I would do 20% down, save the PMI, and invest what you are saving on your monthly payment.
Posted on 9/18/21 at 9:25 am to Drizzt
I would think about the PMI being an “addition” to the expense ratio on whatever fund you are wanting to invest the cash. It really just comes back to how much leverage you want versus market exposure versus cash on hand. There isn’t a right answer.
Personally, I like the hedge a mortgage gives against inflation in the environment today.
Personally, I like the hedge a mortgage gives against inflation in the environment today.
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