Quote:
Originally Posted by polak
Why is the total % burrowed so important?
If I am able to hypothetically scrape up 500K and put that towards a million dollar home, am i some how better off than someone who only put down 5% on a 250K home?
I think the only thing that matters is how the debt is structured vs. the income of the home owner. If you make 2 or 3 times your mortgage payment in a month (for a normal term mortgage of course) but for some reason can't currently save your suggested down payment, you shouldn't buy a home?
Genuinely interested in opinions here as this is the position I am in. I can comfortably afford the mortgage I'm looking to get in to but i dont have the luxury of time to save up a hefty down payment. Even if you ignore the ridiculously low interest rates, I don't feel like I'm some how making a poor financial decision.
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The downpayment gives you breathing room to sell in the event of you losing your job a few weeks after the price drops by 10 or 15 percent.
It's insurance against bankruptcy, not losing the house.