A 20% down payment can make a real impact on your mortgage. It lowers your monthly costs and puts you in a stronger financial position from day one.
First, you avoid private mortgage insurance (PMI). Most lenders require PMI if you put down less than 20%. That added monthly fee doesn’t build equity or reduce your loan. Skip the PMI, and you reduce your carrying costs right away.
Second, you borrow less. A smaller mortgage means lower interest charges over the life of the loan. You also have a better shot at a lower interest rate. Over time, those savings add up. You’ll build equity faster; if you make extra payments, you could pay off your mortgage years earlier.
Third, a larger down payment can strengthen your offer. Sellers and lenders often see it as a sign of financial stability. That can give you more leverage in a competitive market or during negotiations.
Putting 20% down isn’t a requirement, but if it’s within reach, it’s worth thinking about. It reduces risk, gives you more options, and saves money over the long haul.
Talk to your lender if 20% feels out of range right now. They can walk you through alternatives and help you find a down payment amount that suits your budget and goals.
