Been crunching numbers and I'm kinda stuck deciding between putting down a bigger chunk upfront to get a lower interest rate or keeping more cash handy and accepting a slightly higher rate. Curious what others prefer and why?
"Been crunching numbers and I'm kinda stuck deciding between putting down a bigger chunk upfront to get a lower interest rate or keeping more cash handy and accepting a slightly higher rate."
Been there myself and usually lean toward keeping more cash liquid. Sure, lower interest feels good on paper, but liquidity gives you flexibility—especially when unexpected repairs or opportunities pop up (and they always do...). Plus, having cash on hand can help you jump quickly on another deal if the right one comes along. Just my two cents from experience.
Totally get your point about liquidity—it's saved me more than once. But another angle worth considering is how long you're planning to hold onto the property. If it's a long-term investment, shaving off even half a percent on interest can add up big-time over the years. Ran some numbers myself recently, and the savings were pretty eye-opening. Still, if you're thinking shorter term or flipping, cash in hand might be smarter...depends on your strategy I guess.
"If it's a long-term investment, shaving off even half a percent on interest can add up big-time over the years."
That's true, but I'd caution against focusing solely on interest rates. Locking up too much cash in a down payment might limit your flexibility—especially if the market shifts unexpectedly. I've seen clients regret tying up liquidity when unexpected repairs or opportunities popped up. Sometimes, paying slightly higher interest is worth keeping your options open...just something to consider.
Fair points raised here, but honestly, I've seen investors get burned both ways. Sure, locking in a lower rate saves money long-term, but liquidity is king when unexpected costs hit—think roof replacements or sudden vacancies. Personally, I'd lean toward keeping more cash accessible, even if it means swallowing a slightly higher interest rate. Flexibility often outweighs the savings from a marginally better rate, especially in unpredictable markets. Just my two cents...
