Standard Down Payment Larger Down Payment
Purchase Price $325,000 $325,000
Down Payment $65,000 (20%) $75,000 (23.08%)
Loan Amount $260,000 $250,000
Interest Rate 7.125% 7.125%
Monthly Payment $1,724 $1,673
Total Interest Paid $352,517 $339,232
Savings over 30 Years - $13,285

Putting more money down toward your down payment reduces the loan amount, which lowers the monthly mortgage payment but doesn't save as much interest over the life of the loan as Scenario 1. 

 

Making an Informed Decision

As a homebuyer, navigating the complexities of mortgage financing requires careful consideration of your financial goals, preferences, and long-term plans. Whether you choose to invest in buydown points or allocate additional funds toward your down payment, weighing the benefits, costs, and potential long-term implications is crucial.

Remember, every homebuyer's situation is unique, and what works best for one person may not be the ideal choice for another. Consult with one of our mortgage experts to explore your options thoroughly and ensure you make the decision that aligns with your financial objectives and homeownership aspirations.

By understanding the nuances of buydown points and down payments, you can confidently embark on your journey to homeownership, equipped with the knowledge to maximize your home-buying potential.