Current Events > Will I regret not putting down 20% on a home?

(+) Yeah! (+)

Right now I can comfortably put down 10-15% on a down payment, but I see a lot of advice recommending 20%.

I could wait another 6 months or so saving up, but I might have to move back in with my parents and it would complicate some things. I'm in a hurry to get out, but also don't want to make a big financial blunder here.

Other homeowners, how much did you put down on your first home, and what do you reccommend?

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20%. those mortgage insurance payments add up...

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30%

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BuckVanHammer posted...

20%. those mortgage insurance payments add up...

Those aren't mandatory these days if you know where to look and you have an excellent credit score.

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Paragon21XX posted...

Those aren't mandatory these days if you know where to look and you have an excellent credit score.

oh. it has been a while since a looked at it them...

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Probably better to lock yourself into a home now even with PMI; PMI should go away once you pay off a certain amount of the principle and mortgage rates are hella low so it's kind of offset by the idea that you're paying less in general.

Homebuying is an annoying and kinda slow process though just a heads up.

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Paragon21XX posted...

Those aren't mandatory these days if you know where to look and you have an excellent credit score.

Do you have any resources I can look into for this? My credit is pretty good, about 750

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I put down 25%

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We didnt put 20% and Im glad we did because the housing market blew up. We just refinanced once we got to 20% equity. Now my house has increased by 100k value in 4 years.

If you can get a Navy Federal Credit Union account just do their 0% down loan. No PMI involved. Interest rate is a bit higher but you get to keep that cash in the bank.

Just need to have a family member who ever served in the US military.

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If you can't buy it outright don't even bother

Hexenherz posted...

Probably better to lock yourself into a home now even with PMI; PMI should go away once you pay off a certain amount of the principle and mortgage rates are hella low so it's kind of offset by the idea that you're paying less in general.

Homebuying is an annoying and kinda slow process though just a heads up.

Ok, if the PMI doesn't actually add that much overhead I'd rather not wait.

Lol its actually been going too fast for me. I started talking to a lender on Monday, and they've already got me pre-approved and the realtor offered to go check out some properties with me tomorrow @_@

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Just use a calculator function on any of the hundreds of real estate sites out there to *get an idea of what your monthly will be (in addition to the mortgage itself you're looking at homeowner's insurance and probably property tax). That's another thing, property tax rates will vary by county (maybe even city?) so if you're looking in one area that's right on the border maybe look at what the rates are on the other side.

Definitely good to get out and start looking, nothing wrong with that! Do not feel pressured to do anything you're not comfortable with regarding making an offer though.

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TeaMilk posted...

Do you have any resources I can look into for this? My credit is pretty good, about 750

Call around with local credit unions and see if they offer mortgages that allow 10% or less down with no PMI required.

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Also if it's your first time buying a home or it's been several years since you purchased on your state might have additional resources/options to look into.

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I put down 0%

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TeaMilk posted...

Ok, if the PMI doesn't actually add that much overhead I'd rather not wait.

Lol its actually been going too fast for me. I started talking to a lender on Monday, and they've already got me pre-approved and the realtor offered to go check out some properties with me tomorrow @_@

otoh PMI is just extra money youre throwing away

I guess there are a lot of factors to weight, but PMI is literally just wasting money. All other higher costs (more down, higher monthly payments) go towards paying down your house faster while PMI just goes into the void

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TheGoldenEel posted...

otoh PMI is just extra money youre throwing away

I guess there are a lot of factors to weight, but PMI is literally just wasting money. All other higher costs (more down, higher monthly payments) go towards paying down your house faster while PMI just goes into the void

Yeah but you can waste a little money to get your own property, or .... dump 100% of your money into renting

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What's your monthly?

Hexenherz posted...

Yeah but you can waste a little money to get your own property, or .... dump 100% of your money into renting

yeah of course this is a factor to consider

lifes a balance man

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The current market is fierce as far as home buying. Good luck trying to get a no PMI (on less than 20) or 0% down deal right now. Unless you are buying a POS in a bad neighborhood, then have at it.

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Yadoken posted...

The current market is fierce as far as home buying. Good luck trying to get a no PMI (on less than 20) or 0% down deal right now. Unless you are buying a POS in a bad neighborhood, then have at it.

This depends on where they buy.

You should do some math and see how much PMI + interest you would pay on your life's loan. Then see how that compares to the interest you would pay if you put the extra 5-10% downpayment. Is the difference worth the extra hassle of moving back with your parents?

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