Is it better to put at least 20% down on a home or less?

Question

My husband and I bought a home. We put down 20%. Now we’re reading that it’s oftentimes better to put down less so you can invest the rest of your money, and you also get a much higher return on investment when you put less down upfront. Slightly panicking now 😭

Answer

If you put down less than 20% here you pay PMI on top of everything else so definitely worth it to avoid that

Answer

Nope. You guys did it right!!

Answer

You did good!!

Answer

With how historically low interest rates are now it doesn't make much of a difference. We put 7% down and only have to pay PMI for two years. When you factor in inflation rates, our interest rate is effectively negative. But definitely nothing wrong with doing 20% down, good for you for having the cash to do so!

Answer

We had enough saved to put down a larger amount, but we calculated it all up and it only changed our payments by a few dollars, so we decided to put the minimum amount down and keep the extra money to improve the house. We’d be paying our mortgage for 25 years regardless, so didn’t really make sense to put that extra cash down when it barely changed our payments.

Answer

When you put less than 20% down, you have to pay PMI. A main reason my husband and I were ok with that was because we were going to refinance after doing a serious home renovation, which brought the house value way up, thus eliminating the need for PMI. If you were able to do the 20% and the numbers worked out well for you, then that’s great!

Answer

I think if you can put 20% or more down, you should. We put 10% down and had to pay PMI for a bit. It wasn’t the end of the world, but it would’ve been nice to have more invested in the house up front. When we’re ready to buy again, we’ll probably look to put at least 20% down on the next house.

Answer

In general, if you can, putting 20% down is going to be the better option. You get a better interest rate & avoid payment private mortgage insurance. So you save significantly over the life of your loan. 
That said, if you look at the opportunity cost of that money, then maybe/maybe not. Could you use that money you put down to invest else where and earn a higher return than the savings your are earning? Maybe. But would you have used that money for that purpose? Would that investment have been successful? Etc? 
There are situations where putting less than 20% down makes sense for some people, but honestly that’s pretty high level financial planning. For most consumers 20% down is a great financial choice! I definitely wouldn’t stress about it 👍

Is it better to put at least 20% down on a home or less?

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