Mortgage Blog

Why Bigger Down Payments Are Better For Buying a House and your Pa Mortgage

April 4th, 2013 6:21 PM by Michael and Jill Kohler

Saving for a down payment might be tougher than it has ever been. After the housing crash a few years back, many conventional lenders increased their down payment requirements to 20%. Today the average down payment if 9%, as compared to 2004 when the average down payment was only 3% of the purchase and 42% of all buyers financed the entire purchase price putting no money down.

There are 3 reasons that it might be worth your while to save a little more for your down payment.

1) A lower rate of interest. With a lower dti, you’ll get a lower interest rate.

2) You’ll be protected if your appraisal is low.

3) You will pay less in the long run, having a lower principal balance, means you’ll pay back less interest over the years.

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Posted by Michael and Jill Kohler on April 4th, 2013 6:21 PM


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