Is It Better to Have a 20% Down Payment When Buying a Home? – Home Buying Course Session 10

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Now we have completed the offer. Let’s dive in and see if a 20% down payment truly is worth it.

Click Here to Go Back to Session 9: How to Make a Successful Offer on a Home




Is 20% Down Better? Simply Put, Yes (But Wait)

– You will avoid mortgage insurance (PMI). PMI typically costs $30 to $70 for ever $100k loaned.

– You’ll have an immediate increase in equity

– Your monthly mortgage will be

4 Factors to Consider

-Putting down 20% will not overextend your finances.

-The down payment does not need to be used for anything else

-A lower monthly payment

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-If you save 20% you will be able to afford the monthly payment



But 20% Is Not Always the Best Idea

Especially if you are leaving yourself with little in emergency savings. I encourage six months of living expenses saved up AFTER all closing costs on the mortgage. So, if you will not have that six months of savings I advise AGAINST the 20% down.


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So, take these factors into consideration and do your best to not overextend yourself.


Always Moving Forward,

||| Max


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As a certified credit counselor and syndicated writer at MaxMyMoney, Max has coached over 250 Millennials to help take the stress out of money. When Max is not coaching, you'll find him reading financial books, indoor cycling, or visiting local pawn shops looking for swiss-made watches.