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re: Is it always best to put 20% down on a house to avoid PMI?
Posted on 11/19/20 at 3:18 pm to Texas Tea 123
Posted on 11/19/20 at 3:18 pm to Texas Tea 123
You do realize that my mortgage payment with principal, interest, pmi, insurance, and taxes was the same amount as if I had rented the same house? And I probably spent less than $1000 in maintenance in the 2 years I owned it.
1
Posted on 11/19/20 at 4:20 pm to pioneerbasketball
If you can afford it, yes.
Posted on 11/19/20 at 7:32 pm to jimbeam
quote:
15k wasn’t it? I done fricked up baw
Yep
Posted on 11/19/20 at 9:56 pm to Chasin The Tiger
quote:
You do realize that my mortgage payment with principal, interest, pmi, insurance, and taxes was the same amount as if I had rented the same house? And I probably spent less than $1000 in maintenance in the 2 years I owned it.
And what percentage of that money would you say went to your principal during those two years?
Posted on 11/19/20 at 10:08 pm to Joshjrn
Well 0 was going to principal when he was renting 
Posted on 11/19/20 at 10:17 pm to Joshjrn
Not to mention the tax deductions and the home appreciated 80k in 2 years.
Posted on 11/19/20 at 11:37 pm to ellesssuuu
quote:
As a person in the mortgage industry don’t put 20% down. Instead of monthly PMI, see if your mortgage person can run a one time single premium MI. It’s a one time charge and you never pay monthly MI.
if you sell before you break even then that would not be the best route
Posted on 11/20/20 at 5:45 am to Chasin The Tiger
If you rented you wouldn’t have paid taxes, home owners insurance, or maintained a home in addition to interest....
You’d have saved about 50k on a 300k home
You’d have saved about 50k on a 300k home
This post was edited on 11/20/20 at 5:55 am
Posted on 11/20/20 at 6:20 am to PropofoLSU
You still would've paid all of that in your rent payment. It would've just been going towards your landlords mortgage.
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!
Posted on 11/20/20 at 9:44 am to pioneerbasketball
Congrats on your house. This is one of those situations where it’s risk in the market vs getting rid of PMI. For me, I would get rid of the PMI and reduce my debt. Others will invest. Neither is wrong, it just depends on your mindset.
If you’re able to save 10% of your earnings either way, you are going to be fine long term no matter what you decide.
If you’re able to save 10% of your earnings either way, you are going to be fine long term no matter what you decide.
Posted on 11/20/20 at 1:09 pm to pioneerbasketball
quote:
I'm 22 years old
quote:
Member since Oct 2005
Que?
Posted on 11/21/20 at 1:39 am to pioneerbasketball
You were posting on this site as a 7 year old?!?
ETA: Dammit. See I’m late with this question
ETA: Dammit. See I’m late with this question
This post was edited on 11/21/20 at 1:42 am
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.
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