Wondering how much you need for a down payment? This calculator allows you to input your home purchase price, mortgage term, and interest rate. It will then estimate different down payments with corresponding monthly payments.
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Should you put down a large or small down payment?
It ultimately depends on your situation. Younger borrowers who entered their working years not long ago might not have significant funds in a savings account yet. These individuals could also be prioritizing their student loans or credit card debt.
Higher-income earners, on the other hand, typically have the flexibility to save more of their income. It’s why lenders often see larger down payments with these borrowers. However, it’s not always the best move to wipe out a savings account for a home purchase.
Use PMI to your advantage
Private mortgage insurance protects lenders in case you fail to keep up with your mortgage. If you’re unable to put down 20%, you can expect to pay for PMI every month until your loan reaches the 80/20 loan-to-value (LTV) mark. Though PMI is an added cost, it can help you achieve your homeownership goals sooner.
Ask about down payment assistance
Down payment assistance makes qualifying for a home loan so much easier. Call one of our salary-based mortgage consultants for more information.