🏠 Should you buy a home now with PMI or wait?

You have a solid income, a modest rental, and about $40,000 saved. But a $360,000 house requires $72,000 for a full 20% down payment. If you buy now, you pay Private Mortgage Insurance (PMI). If you wait a year to save the rest, the house might cost more. This calculator compares the cost of paying PMI today against the cost of buying a more expensive home later.

PMI protects the lender if you stop paying. It is an extra monthly fee added to your mortgage until you reach 20% equity. Many buyers worry about this extra cost. But avoiding it means waiting. We assume you pay PMI for the entire time it takes to save your remaining down payment.

While you save that extra $32,000, home prices do not stand still. If homes appreciate at 4% a year, your target house gets more expensive every month. Often, the cost of that lost appreciation is higher than the PMI premiums. Adjust the appreciation rate to see how a flat or hot market changes the math.

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