How much money should I put down on a house

How much money should I put down on a house. This depends on several factors:

1. Are you looking for the lowest payment possible (usually trying to eliminate PMI)

2. Do you have reserve funds available after your purchase

3. Do you intend to sell in the next few years

There are many other questions we can ask but to keep this short lets handle these for now. Usually when I am asked this question it is because the person whould like to put down as little as possible. This is fine if you are buying a home within your means. Usually I recommend a 30 year fixed loan in this situation so that there are no surprises later. The only problem with zero down or little down, when you plan on holding onto the property for many years, is the PMI payment. This can sometimes be avoided or reduced but if you have to pay it please factor that cost into your monthly payment.

Often times I will have couples come in to buy there first home and they have 5% to put down. however, after putting that money down they don't have very much cash left in the bank. This can be a big mistake. Putting the 5% down will reduce your monthly payment slightly but will leave you up the creak with a paddle if something happens after yo close. (New furnace needed, waterheater, septic system etc.) We never expect things to happen, especially after a home inspection but Murphy's Law says that they will.

Lastly, parts of the  USA have declining property values. If you know that you will need to sell in the next few years and you are in one of these regions yo may actually want to hold off buying. If you are in a growing region of the country (contrary to the news casts today that is a large part of The US) you should be fine. The scary thing is that if your area starts to decline and you bought at the height of your market you may need to come to closing with money.

To be sure you understand your market and your options, because there are many options available, always use a reputable Mortgage Planner. One that you can sit face to face with.

If you would like to calculate how the amount of money you put down affects your return on investment go this calculator. How much should I put down to get the best ROI