Which Down Payment Strategy Is Right For You And Purchasing A Home In Spring Texas

Dated: September 28 2018

Views: 453


You’ve most likely heard the rule: Save for a 20-percent down payment before you buy a home. The logic behind saving 20 percent is solid, as it shows that you have the financial discipline and stability to save for a long-term goal. It also helps you get favorable rates from lenders.

But there can actually be financial benefits to putting down a small down payment—as low as three percent—rather than parting with so much cash up front, even if you have the money available.

THE DOWNSIDE

The downsides of a small down payment are pretty well known. You’ll have to pay Private Mortgage Insurance for years, and the lower your down payment, the more you’ll pay. You’ll also be offered a lesser loan amount than borrowers who have a 20-percent down payment, which will eliminate some homes from your search.

THE UPSIDE

The national average for home appreciation is about five percent. The appreciation is independent from your home payment, so whether you put down 20 percent or three percent, the increase in equity is the same. If you’re looking at your home as an investment, putting down a smaller amount can lead to a higher return on investment, while also leaving more of your savings free for home repairs, upgrades, or other investment opportunities.

THE HAPPY MEDIUM

Of course, your home payment options aren’t binary. Most borrowers can find some common ground between the security of a traditional 20 percent and an investment-focused, small down payment. Your trusted real estate professional can provide some answers as you explore your financing options.


Image title


Click Here...to view all homes for sale in The Houston TX area and surrounding cities.

Best Priced Properties Team "Clients First" Russell and Melissa Banki Texas REALTORS- Hite Properties Certified Negotiation Experts (CNE) Accredited Luxury Home Specialist (ALHS) Certified Home Selling Advisors (CHSA) Certified Home Buying Advisors (CHBA) Certified Expert Home Selling and Buying Advisors. Ask us about our Smart Home Buying and Selling Strategy. CALL OR TEXT. cel 713-480-0889 or 936-445-0216. As local real estate Montgomery County Real Estate Experts in The Woodlands, Spring,Shenandoah, Magnolia, Montgomery, Conroe and Greater North Houston/Houston TX Metro areas we can save you valuable time & money! Contact us today. We want to earn your business and help you achieve all of your real estate goals. It would be our pleasure to help you with all your residential/commercial buying, selling or investment needs. We believe our clients should feel confident and benefit from selling or purchasing real estate. Be sure and ask us about our current buyer and seller promotions.

Client Testimonials

Blog author image

Russell Banki REALTOR® ALHS CNE

Russell Banki ALHS, CNE REALTOR Hite Properties Cell: 713-480-0889 Best Priced Properties Team Montgomery & Harris County TX Real Estate Experts Clients First!Treating the relationship with f....

Want to Advertise on this Site?

Latest Blog Posts

JUST LISTED In NEW CANEY 5 Minutes From US59

22061 Russell Drive New Caney 77357Fantastic investor rehab opportunity to own home on half acre lot in New Caney Heights! Home to be sold as-is. Zoned single family residential but UNRESTRICTED

Read More

Under Contract In San Antonio TX In Community Of Redland Woods

Under Contract in Redland Woods! Russell and Melissa BankiCertified Real Estate ExpertsBest Priced Properties Team- Hite PropertiesHelp our clients achieve all of their real estate goals

Read More

Just Listed Acreage Property In Conroe On Golf Course With Pool Next To I45

JUST LISTED! 720 Stonewall Jackson Drive Conroe, TX 77302 Rare opportunity in RIVER PLANTATION ready for its new owners! This beautiful updated 2 story 4 bedroom 2950 square foot GOLF

Read More

JUST LISTED In Deerbrook Estates

JUST LISTED IN DEERBROOK ESTATES! 8926 Farm Ridge Ln Humble, TX 77388MOVE-IN READY! FANTASTIC NEWER HOME 4 bedrooms 2.5 baths in DEERBROOK ESTATES! MASTER SUITE on the 1st FLOOR!

Read More