20% down on a house…is it dumb?

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You avoid pmi with 20% down

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This... Usually makes sense just to avoid PMI.

Well your acquaintances are poor af, think of pmi as a poor person’s tax. You are basically paying points for nothing. Avoid at all costs.

If you have enough invested in a taxable account, you could borrow against portfolio for down payment. Margin rates w/ IBKR are below 1.4% (variable). That beats selling assets and paying capital gains.

I'll have 10-12% for my primary residence when I pull the trigger next year. Would like to get to 20%, but time won't be in my favor and PMI will be a drop in the bucket all things considered.

You just have to do the math and figure out what works best for you.

The more you put down the less you'll pay on the life of the loan, but if you've got an investment vehicle that's going to consistently outperform your mortgage rate plus PMI payments it might be worth considering.

If the money's just going to be sitting in a low interest savings account, I'd lean towards putting it into the house.

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You don’t need 20% to avoid pmi if you have excellent credit and a good broker.

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Explain that

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You don’t need 20% to avoid pmi if you have excellent credit and a good broker.

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I am assuming you mean your broker somehow negotiates such a good price that you already have 20% equity at closing. If an idiot sells a home for 20% under value, good for you. It happened to me on my current home, which had no true comps and it is a VA loan, so I don't pay PMI regardless.

Otherwise, the only way you COULD pull this off was if you somehow got an appraiser to give you an appraisal with LTV of less than 80%. But appraisers are scrutinized on all sides and have the world to lose if they run afoul.

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Well your acquaintances are poor af, think of pmi as a poor person’s tax. You are basically paying points for nothing. Avoid at all costs.

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There are loans available where you can avoid PMI without 20% down. Not that you would know obviously.

You should get quotes on rates for 5%, 10%, 15%, and 20% down. See how it moves, or doesn’t move, the needle on your interest rate. When I bought my house, there was a gulf in interest rate between 5% and 10%, but a relatively small gap between 10% and 20%. Further, at 10%, my PMI was quoted at $35/mo. Giving up opportunity potential as well as a chunk of savings security to barely move the interest rate and then save $35/mo for a few years didn’t seem worth it, so I put 10% down. But your mileage may significantly vary, so you need to do your own legwork.