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As of spring 2022, a 20% down payment on a median-priced home in Portland, Oregon would come to just over $100,000. But you don’t necessarily have to make a 20% down payment when buying a home.
However, many people choose to do so. That’s because it allows you to avoid the added cost of mortgage insurance. The question is, should you?
Generally speaking, whenever the loan-to-value (LTV) ratio rises above 80%, the borrower is required to pay for mortgage insurance. It’s a standard industry requirement that has been around for a long time.
That’s why some home buyers in Portland choose to put down at least 20% when buying a house or condo. They do it to keep the LTV at 80% or below, thereby avoiding the “trigger” that would bring on mortgage insurance.
Not everyone can afford that level of investment. But if you do make a 20% down payment on a home in Portland, Oregon, what might that look like? How much would you actually pay if you went 20% on a median-priced home in the city? Knowing this will give you a starting point for your research and planning.
As of March 2022, the median home price in Portland was around $564,334.
Here’s what the down payment might look like for this price range, based on different mortgage programs and investment tiers.
That gives you some idea of what the average down payment might be in Portland, Oregon, for different financing options. This is based on the median price mentioned above. Obviously, a higher home value would result in a larger down payment in each of these tiers.
Related: How to reduce PMI premiums
We’ve talked about the primary reason why some home buyers aim for the 20% threshold. They do it to keep their initial loan-to-value ratio below the level where mortgage insurance is required. But not everyone can come up with a 20% down payment. Fortunately, you might not have to.
Both of these strategies could reduce your upfront, out-of-pocket expense.
So don’t let the median or average down payment for Portland, Oregon scare you away from buying a home. These days, there are a lot of options when it comes to mortgage financing. The mortgage industry is more flexible than a lot of borrowers realize. So regardless of your budget, there’s probably a financing strategy that’s well suited for you.
In closing, here’s some good news for home buyers who are planning to enter the real estate market soon. You might not have to worry as much about rapidly rising home values, which was a major concern in previous years.
Related: 5 tips for buying a home in Portland, OR
According to the latest real estate reports and MLS data, home prices in Portland have been rising very quickly. According to Zillow, home prices in Portland have increased 12.7% over the past year, and they’re expected to continue on a similar path throughout the rest of 2022.
Our company has been helping home buyers and homeowners across the Pacific Northwest since 1992, including WA, OR CO and ID. Please contact us if you have questions about the minimum down payment for different mortgage programs, or any other financing-related questions. We also have a Rate Quote feature that provides instant quotes, and you can also Apply Now using our online system if you’re ready to apply!
Whether you’re buying a home or ready to refinance, our professionals can help.
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No Obligation and transparency 24/7. Instantly compare live rates and costs from our network of lenders across the country. Real-time accurate rates and closing costs for a variety of loan programs custom to your specific situation.