It’s always best to put 20% (or more) down on a mortgage when you are buying a home. The main reason for this is so that you can avoid private mortgage insurance (PMI) payments. PMI costs you a percentage of your mortgage depending on how close your down payment was to 20%. At first glance it might not sound like much, but over the course of a year PMI could cost you between $500-1500 or more depending on the sale price of your home and how much you put down. In addition to saving on PMI, putting 20% down can help you negotiate better loan terms and rates. Without putting a sizable down payment into your mortgage you will not be building equity in your home for a long time. If you can’t save 20%, saving as much as possible is definitely the best route.
Thinking of buying or selling a home in Sussex County? Give us a call at Cooper Realty Associates and put us to work for you – 302-644-2266.