Sign In Questions? 205.901.6399

Email Address

Password

Sign In

• Alabama Homes
• Search MLS

  • Find Listings

  • Search Property
  • Featured Listings
  • Alabama Land For Sale
  • Browse Communities
  • Listings via Email
  • Alabama Commercial Realtor

  • Search Tools

  • Bookmarked Listings
  • Saved Searches
  • Mortgage Calculator
  • Home Values

  • Commercial

  • Alabama Commercial Real Estate
  • Birmingham, Al Commercial Real Estate
  • Pell City, Al Commercial Real Estate
  • Oxford, Al Commercial Real Estate
• About Us

  • Our Company

  • "Executive Team"
  • Contact Us
  • Join our Team
    
  • Our Real Estate Listings

  • Learn More...

  • Keller Williams Office
  • Meet Our Team
  • FAQs
  • Alabama Realtor
• Communities

  • Popular Searches

  • Logan Martin Real Estate
  • Pell City Homes
  • Lincoln, Al Homes
  • Alabama Foreclosed Homes

  • Other Areas

  • Oxford, Al Homes
  • Moody, Al Homes
  • Trussville Homes
  • N. Henry Lake Homes
    
• Contact Us

• Home
• Sign In
• Register
• Sitemap
• Help

Save or Borrow the Money for a Down Payment

Posted by Barry Lynn Miller on Monday, May 23rd, 2011 at 5:57pm.

The numbers do not lie if you buy now it will cost you less thease numbers are based on saving over 700 per month and who can do that these days.



Information About You and the Home You Wish to Buy
Expected Period in House If You Buy Now 30 years
Estimated Property Appreciation Rate 4.00% per year
Income Tax Bracket 27%
Pre-tax Rate of Interest on Savings 5.00%
After-tax Rate of Interest on Savings 3.65%
Number of Months You Rent Before You Buy 48 months
Current Monthly Rent $650
Monthly Real Estate Taxes $55 per month
Monthly Home Owners Insurance $65 per month
Monthly Rental Insurance $35 per month
Loan Information Buy Now Save First
Purchase Price $200,000 $233,972
Down Payment $7,000 $46,794
Loan Amount $193,000 $187,178
Interest Rate 6.000% 6.500%
Loan Term (in years) 30 years 30 years
Monthly Mortgage Payment $1,157.14 $1,183.10
Monthly Mortgage Insurance Payments $154.40 $0.00
Buy Now Loan Balance Reaches 80% of Appreciated Value in Month 43
Points 1.00% 1.00%
Other Closing Costs $2,500 $3,000
Results - Assuming a 30 Year Holding Period Buy Now Save First
Cost of Rent $86,508
Cost of Renters Insurance $4,658
Cost of Lost Interest on Down Payment $13,890 $73,907
Cost of Points Net of Tax Savings $4,235 $3,550
Cost of Other Upfront Charges $7,461 $7,738
Cost of Monthly Mortgage Payments $754,856 $614,333
Cost of Monthly Mortgage Insurance Premiums $9,449 $0
Cost of Homeowners Insurance $42,402 $33,752
Cost of Property Taxes $26,192 $20,848
Less: Tax Savings on Mortgage Interest $123,322 $111,708
Less: Increase in Property Value $448,680 $414,708
Less: Reduction in Loan Balance $193,000 $137,296
Equals - Net Cost $93,482 $181,582
Conclusions
The Cost of Saving First Exceeds the Cost of Buying Now by: $88,100
Saving First Would be the Better Choice Only if Your Monthly Rent is Less Than: ($12)


A Complete Real Estate professional has knowledge of both sides of the business

Give me a call at 205-338-5555 or visit Alabama Homes

---

---

Leave a Comment

• Your Name * Your Email * (private)
• Website
• Comment *

Submit Comment

Find Your Property...

City

Select a City Abernant Adamsville Addison Adger Alabaster Albertville Alexander City Alexandria Aliceville Alpine Altoona Anniston Argo Arley Ashland Ashville Attalla Baileyton Bessemer Billingsley Birmingham Blount Springs Blountsville Boaz Boligee Bon Air Branchville Bremen Brent Brierfield Brighton Brookside Brookwood Buhl Calera Cedar Bluff Center Point Centre Centreville Chalkville Chelsea Childersburg Clanton Clay Cleveland Coaling Coker Collinsville Columbiana Concord Cordova Corner Cottondale Cragford Crane Hill Cropwell Cullman Dadeville Deatsville Decatur Delta Dixiana Docena Dolomite Dora Double Springs Duncanville Eastaboga Eclectic Elberta Empire Equality Eutaw Eva Fairfield Fairhope Fayette Five Points Foley Forestdale Fosters Fruithurst Fultondale Gadsden Gallant Garden City Gardendale Glencoe Goodwater Graysville Green Pond Greensboro Guin Gulf Shores Haleyville Hamilton Hanceville Harpersville Hartselle Harvest Hayden Heflin Helena Hobson City Hokes Bluff Hollins Holly Pond Homewood Hoover Horton Hueytown Huntsville Indian Springs Village Irondale Jacksons Gap Jacksonville Jasper Jemison Jones Kellyton Kimberly Lakeview Lawley Leeds Lincoln Lineville Lipscomb Locust Fork Lynn Madison Maplesville Marbury Margaret Marion Maylene Mcadory Mccalla Mcdonalds Chapel Midfield Millbrook Millerville Mobile Montevallo Montgomery Moody Morris Moulton Moundville Mount Olive Mountain Brook Mulga Munford Muscadine Nauvoo New Castle Northport Oak Grove Odenville Ohatchee Oneonta Opelika Orange Beach Oxford Parrish Pelham Pell City Piedmont Pike Road Pinson Plantersville Pleasant Grove Prattville Prescott Quinton Ragland Rainbow City Ranburne Randolph Reece City Reform Remlap Riverside Roanoke Rock Creek Rockford Shelby Sipsey Skyline Snead Southside Springville Stanton Steele Sterrett Sulligent Sumiton Sycamore Sylacauga Sylvan Springs Talladega Tallassee Tarrant Thorsby Trafford Troy Trussville Tuscaloosa Vance Vandiver Verbena Vestavia Hills Vincent Vinemont Wadley Walnut Grove Warrior Weaver Wedowee Wellington Weogufka West Blocton West Jefferson Westover Wetumpka Wilsonville Wilton Winfield Woodland Woodstock Wylam

Property Type

• Residential
• Land/Lots
• Commercial
• Multi Family

Price Range

Min $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000

Max $50,000 $75,000 $100,000 $125,000 $150,000 $175,000 $200,000 $225,000 $250,000 $275,000 $300,000 $325,000 $350,000 $375,000 $400,000 $425,000 $450,000 $475,000 $500,000 $600,000 $700,000 $800,000 $900,000 $1,000,000 $1,250,000 $1,500,000 $1,750,000 $2,000,000 $2,250,000 $2,500,000 $2,750,000 $3,000,000 $3,250,000 $3,500,000 $3,750,000 $4,000,000 $4,500,000 $5,000,000 $5,500,000 $6,000,000 $6,500,000 $7,000,000 $7,500,000 $8,000,000 $8,500,000 $9,000,000 $9,500,000 $10,000,000

Min $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 $5,000 $5,500 $6,000 $6,500 $7,000 $7,500 $8,000 $8,500 $9,000 $9,500 $10,000

Max $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 $5,000 $5,500 $6,000 $6,500 $7,000 $7,500 $8,000 $8,500 $9,000 $9,500 $10,000

Zip Code

County

• No Preference Autauga Baldwin Bibb Blount Calhoun Chambers Cherokee Chilton Clay Cleburne Coosa Cullman Dallas Dekalb Elmore Etowah Fayette Greene Hale Jackson Jefferson Lamar Lawrence Lee Madison Marion Marshall Mobile Montgomery Morgan Other Perry Pickens Pike Randolph Shelby St.clair Sumter Talladega Tallapoosa Tuscaloosa Walker Winston

MLS® Number

Property Sub-Type

All Single Family Condominium Townhouse Manufactured Farm

Bedrooms

Min. - 1 2 3 4 5 6 7 8

Max. - 1 2 3 4 5 6 7 8

Bathrooms

Min. - 1 2 3 4 5 6 7 8

Max. - 1 2 3 4 5 6 7 8

Foreclosures

No Preference Search Foreclosures Exclude Foreclosures

Waterfront

No Preference Search Waterfront Exclude Waterfront

Financing Type

Select a financing type All financing types Cash Conventional Lease Purchase Owner Held Mortgage USDA Rural FHA / VA Alabama Bond Private Other

... or try our Advanced Search