How an Additional $10,000 Down Can Impact Your Monthly Payment
- Chad Helmcamp | Texas Mortgage Loan Officer
- Apr 10
- 2 min read
When it comes to buying a home, many homebuyers focus on the size of their down payment. Over the years, I’ve often told clients that putting an extra $10,000 down would typically reduce their monthly payment by about $50. This has been true for most of my career—until recently.
With interest rates rising, I decided to run some new numbers to see how things have changed. What I discovered might surprise you.
How Interest Rates Affect Your Payment
In today’s market, with rates hovering around 7%, putting down an additional $10,000 actually reduces your monthly payment by about $60 to $65. At a 6% interest rate, the improvement is slightly lower but still significant—around $60 per month. And at 5%, it’s close to $50, just like what I’ve seen in the past.
Why Does This Matter?
At first glance, these numbers may not seem groundbreaking. However, when you’re working with larger loan amounts, the savings can add up quickly. Putting down an extra $10,000 can significantly improve your financial situation in the long run by lowering your monthly payments.
It’s also important to note that while the interest rate plays a big role, the amount you put down still makes a difference. The more you put down upfront, the more you can reduce your payment, regardless of what the current interest rate is.
What Does This Mean for Homebuyers?
If you’re considering buying a home, it’s worth exploring the impact of putting down a larger down payment. Depending on the current rate environment, an extra $10,000 down could give you more breathing room in your budget, putting an extra $60 to $65 back in your pocket each month.
While this might not be the right option for everyone, it’s a strategy worth considering if you’re looking to reduce your monthly payments in today’s market.
As always, if you have any questions about how this could work for you, feel free to reach out!
Want to learn more? Watch the full video on YouTube here! [Watch Video]
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