3 times you don’t need a 20% down payment

Saving up for a 20 percent down payment, while preferred, isn’t always the best strategy for buying a home. Here are three times you shouldn’t bother with it.

1. Prices are going up fast. You’re interested in a house selling for $500,000, but you only have $50,000 saved up. You can wait until you’ve saved the full 20 percent or buy now and pay insurance on the mortgage. The problem is that if prices go up, that 20 percent down payment will also increase. In these cases, it may be more advantageous to buy now.

2. You need the cash. Sometimes a problem with the house only becomes apparent after the purchase is finalized. Or, you may have planned to make some repairs or update the appliances. In such cases, putting down less than 20 per cent lets you deal with these expenses instead of having to take out an additional loan.

3. You don’t want to wait. If you’re starting a family, it may be worth it to pay insurance on your mortgage to ensure that you don’t miss out on a great home.

Being flexible with your down payment could pay off. It’s a matter of considering the market, your future plans and your current needs.