Buy a home now or save more for downpayment

Today I will be discussing if it makes sense to purchase now or wait to save up a larger downpayment.


With home prices and interest rates at very low levels it doesn't make sense to hold off.

Let’s assume that over the next year you are going to be able to save $500 per month for a total extra down payment of $6,000 next year.

rate and payments are for illustration purposes and are a principal and interest payment. This payment doesn't include taxes, insurance, or monthly mortgage insurance. Contact me if you would like to know your exact loan payment scenario and apr.

 Let’s use the following scenario,
Purchase Price $150,000
Putting the minimum 3.5% down at a 4.5% 30 year fixed rate.
$735 monthly payment Total interest over 30 years is over $119,000

Next year putting an extra $6,000 down
Rate at 5%
$745 monthly payment. Total interest over 30 years is over $129,000
Rate at 5.5%
$788 monthly payment. Total interest over 30 years is $145,000

It doesn't make sense to wait and save up a larger downpayment. This illustration was that mortgage rates are going up which is the most likely scenario. It doesn't also take into account that the home you are looking at today is going to cost you more next year.

I hope you found this information helpful. If you know of others who would like this information, please email, forward or share it with them.

4.025% APR on 30 year fixed rate

Rates are at all time lows. If your current interest rate is 5% or higher you should definately see if refinancing makes sense. With interest rates this low and the current prices of homes now is an excellent time to purchase a home. Give me a call today to get preapproved or see if a refinance is right for you at (920) 788-9608 or apply online at http://www.getapprovedfast.com/

Todays rates are:
30 year fixed rates 4% 4.025% APR
15 year fixed rates 3.375% 3.784% APR
5 year arm 2.75% 3.066% APR

All rates based off a $165,000 loan amount, 20% down or equity required, 740 credit score, owner occupied single family residence with escrows, and no subordinate financing. APR is subject to change.

Depending on the loan program we can lend to as low as a 620 credit score and certain areas still offer 100% financing no money down loans.

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