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The Top 3 Benefits of a 20% Down Payment when Buying a Home
Many of us have heard when buying a home that it is best to put down 20% of the home’s price.  While this is not possible for everyone, if you can do it there are huge benefits.  Here are the top 3 benefits to putting down a 20% down payment when buying a home:
1. The Evil Mortgage Insurance- Some of us have heard that Mortgage Insurance is EVIL.  It’s not really evil as it is something that is required when you are putting down less than a 20% down payment when getting a conventional loan.  Mortgage insurance is insurance for the lender incase you are foreclosed on, it helps them recoup some of the money they lose.  But with a 20% down payment you can avoid mortgage insurance, saving you money each month on your mortgage payment.  On a 200,000 loan amount and a 5% down payment(740+ credit score) the mortgage insurance alone could be $98 a month.
2. Escrow Account- An Escrow Account is an account that your mortgage lender holds to collect the taxes and insurance for the home.  At the end of the year they pay the tax and insurance bill for you.  In ... more

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