Considering a large down payment?

The Math:

At today's interest rates (mid 4%'s), every $10,000 borrowed on a 30-year fixed rate translates into a monthly payment of roughly $50. Of that, about $37 is interest.

Here are a couple of questions to ask yourself:

  • "Can I make more than $37(x)/mo by keeping my $10,000(x) in my investment portfolio?"
  • "Will the $50(x)/mo be reflected in my monthly budget? Or am I going to spend it?"

And some common arguments:

  • This is a relatively low cost of borrowing. Borrowing more keeps my money liquid for higher-earning investment opportunities in the future, and my higher mortgage payment helps me keep my spending in check.
  • Borrowing rates on the mortgage are lower than other rates I am paying. It makes sense to pay off all other debt first, then set my mortgage amount. If I'm worried about paying more interest as a result of the longer term on the mortgage, I can prepay the loan aggressively, and maintain lower minimum monthly payments and interest savings.
  • Most mortgages do not charge a prepayment penalty and lenders will usually "recast" the payment when large principal contributions are made. Therefore I can borrow more than I need at closing and pay down the loan later once the dust settles and have the payment lowered to reflect the reduced loan balance.


The benchmark down payment is 20% because that allows you to avoid paying mortgage insurance. Whether to put more down is a matter of personal preference, and the best decision is the one you feel best about after considering the alternatives available to you now or in the future.

Foundry Mortgage GUARANTEE:

If you're like most people, you want expert advice and the best deal. That's our mission! If we don't have the best deal when you're ready to lock in your interest rate, we'll transfer all paperwork to your lender of choice at your request. No cost or obligation. Call now to validate the "best advice" part of the agreement - you'll know within 5 minutes that we are qualified to be your expert home loan advisors.

Loan Advisor Mission Statement

"To assist others in making the best home financing decisions, at the lowest cost and interest rates available."

Are you ready to get started?

Foundry Logo

Expert Home Loan Advisors

5975 Shiloh Road
Ste 114-13
Alpharetta, GA 30005
NMLS 1737164 Georgia Residential Mortgage Licensee 62261

©2023 Foundry Mortgage Services, Inc