Down Payment Calculator
10% down vs 20% down — see the real cost difference including PMI.
10% Down vs 20% Down: The Real Comparison
On a $400,000 home, here's what the numbers look like:
| 10% Down | 20% Down | Difference | |
|---|---|---|---|
| Down payment | $40,000 | $80,000 | $40,000 more upfront |
| Loan amount | $360,000 | $320,000 | $40,000 less debt |
| Monthly P&I (6.5%) | $2,275 | $2,023 | $252/mo savings |
| PMI | ~$150/mo | $0 | $150/mo savings |
| Total monthly | $2,425 | $2,023 | $402/mo savings |
| Total interest (30yr) | $459,000 | $408,000 | $51,000 savings |
The extra $40,000 upfront saves you $402/month and $51,000 in total interest. But that $40,000 could also be invested — at 10% average returns, it would grow to ~$70,000 in 7 years. The "right" choice depends on your interest rate vs expected investment returns.
The 10% Price Drop Risk
If you put 10% down and the home drops 10% in value, you are underwater — you owe more than the home is worth. With 20% down, a 10% drop still leaves you with 10% equity. This is the core argument for larger down payments: they buffer against market risk.
What Is PMI?
Private Mortgage Insurance (PMI) is required when your down payment is less than 20%. It typically costs 0.5-1% of the loan amount per year ($150-$300/month on a $360K loan). PMI can be removed once you reach 20% equity.
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