Reply to When million-dollar-plus homes are purchased, do people put more than 20% down?

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Reply to "When million-dollar-plus homes are purchased, do people put more than 20% down?"

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[quote=Anonymous][quote=Anonymous][quote=Anonymous]Not always.  We were planning to put 10% down but got a loan that allowed us to put 5% down.  My husband was nervous that the economy was going to be such that we would not be getting raises in the near future so we decided to keep the money in cash.  Later, as our house value appreciated, and we felt a bit more comfortable we were able to refinance both mortgages into a single 20 yr fixed and put in more of our cash.  Of course this was only done b/c we had sufficient cash.[/quote]

I don't understand your logic. Seems like you would want to put more down to keep the mortgage payments low. We wanted to put more down so that if we went down to one salary, we could still afford the mortgage. We were able to do about 50% down.[/quote]

We didn't have enough for 20% at the time, and we had not yet had kids so not clear how much we would need to dip into our savings.  Given that we have relatively stable jobs (mine's in fed govt and DH's is not federal but works with feds) we didn't feel as much risk about losing our jobs.  We just didn't know whether we'd have any significant way of getting our hands on cash should our salaries stay flat and we put a huge chunk of our cash into the house.  We never had huge bonuses or really high salaries and it took DH quite a bit of time saving up more than $100K of his own money since he as a young man before we amassed enough together as a married couple to take the plunge.  Unfortunately we missed the market in Arlington so we bought our house that we are staying in to raise our kids as opposed to our first starter house (didn't think we'd see much appreciation and would lose out w/ transaction costs.).

Was your 50% down purely from savings?  Or did you use some of your equity from a previous home sale?  We couldn't have afforded 550K (50% down) at the time we bought our house.  But if we had waited about 2 yrs we would have saved more than $300K cash except the house we wanted would probably not have been available. [/quote]

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