My partner and I are looking to buy a home. We’ve done research and know that there are trade offs to putting the standard 20% vs less (for us it would be a minimum 10%) in terms of PMI and interest rates.
What I haven’t been able to understand is how much should we put down given our financial health and diversification of investments?
10% down payment (for a particular home we are vying for) is roughly 15% of our net assets including savings, investments, and retirement. A 20% down payment would be 30%. Almost all of our investments are in the market (and some crypto) because we’re young and don’t mind taking the risks. We’d have to sell some of our investments to make a 10% down payment, but we have enough in long term gains and losses that we can minimize our tax implications. A 20% down payment would require selling some investments at short term gains. So if needed we could put 20% down, and it would involve pulling more out of the market, but would we want to? Is there a ratio of home equity to other equity we should be aiming for?
I know I won’t get a straight answer necessarily but just hoping for some considerations so that we make the best decision on our loan.
Submitted May 18, 2021 at 12:02AM by messy_bench https://ift.tt/33S2p7f
