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/biz/ - Business & Finance

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13652272 No.13652272 [Reply] [Original]

How do you calculate if it's better to
>pay 3% down on a house and invest the rest
or
>pay 20% down on a house

>> No.13652286

>>13652272
real estate is boomers PND

>> No.13652357

>>13652272
Take the difference on the 17% (also consider that 20% is not really 20%, it's more like 25% because of other closing costs on most houses and would be like 8% even if you put 3% down), then you can do a couple metrics -- look at the S&P 500's returns over time (which is generally about 7-10% YOY in a bullish market like we've been having) for that dollar amount with NO additional investment, and compare it to the additional payments you'd make with PMI (which are a monthly percentage on top of your principal and interest each month that varies with lender), and subtract that from the gains on the stock market investment.

If you're red, buy the house. If you're green, buy the house anyway, because fuck you, property ownership is better in the long term for your family and building wealth because having a variety of different asset classes to draw from is financially smart and home loan interest rates won't rise until after the housing bubble bursts again.

>> No.13652410

calculate in your head whether you can get a good mortgage based on your occupation and credit score
invest if yes 20% if not