Question

If you buy a home and make a relatively small down payment, what happens to the monthly payments and total payment for you loan?

Answer 1

Answer:

Both monthly payment and total payment will increase.

Step-by-step explanation:

If I buy a home and make a relatively small down payment, then the due payment will be more.

If I pay for my home through a bank and I fix the number of installments to pay back the due amount after down payment (say, monthly installment for 5 years), then the amount of installment payment will definitely increase if my down payment is less.

Again, if the down payment is less, the remaining amount to pay back will rise and the bank calculates interest on the remaining amount to pay. Therefore, the amount of interest will rise in value and finally the total payment after interest for my loan will increase. (Answer)