Remember to consider all the extra costs you'll run into when deciding how much money to pay down on the house. It's great to have a big down payment because it reduces the size of your mortgage. It's not great, however, to be unable to afford to buy what you need for your new home.
The cost of moving includes far more than mortgage payments and settlement expenses. When you're thinking about moving, try to anticipate some of the extra costs that you'll encounter. If you can, talk with somebody who's moved recently to see what costs they ran into. Extras can add up fast, for example:
Furniture. Unless you're really lucky, you're going to need some new furniture for a new home. The pieces you have are too worn, or they don't fit, or they don't match the carpets. Where there's a new house, there will be a need for furniture.
Moving expenses. Unless you've got great friends who are willing to give up a Saturday to help you load your stuff into a U-Haul, you can expect to pay out some pretty substantial money for a professional mover. Movers charge by the hour, so save time by packing everything yourself, and move some of the smaller pieces to where the truck will be parked. If you're relocating due to work and your company is picking up the tab, keep in mind that it might not agree to pay extra costs, such as moving your grand piano.
Window treatments. Count on about $500 per window for custom-made window treatments. That can add up pretty fast, as you can imagine. Don't worry. You probably can learn to live with no curtains, or get used to the yellow-and-orange floral drapes that are already there.
Decorating. You can paint yourself and keep the costs down, but chances are you'd rather hire somebody and save yourself the time and hassles. Check in your local shopper's paper for painters looking for work, but make sure they carry insurance and can give you some references. Same goes for paper hangers and other contractors.
Landscaping. Most homeowners haven't updated their landscaping for years. If you're buying a previously owned home, chances are that you'd like to make some changes. The trouble is, landscaping can be really expensive. Don't forget to consider these costs.
Appliances. Major appliances are expensive, especially if you have to buy a houseful of them. Hopefully, at least some appliances will be included with the house you buy. If not, add them onto your rapidly growing list of expenses.
Utility connection fees. The transfer on your telephone, Internet connection, cable TV, and other utilities can really add onto the cost of moving.
Travel expenses. If you're relocating for your job, you may have to move before your family does. If so, you'll encounter expenses traveling back to see them, or having them come to see you.
Double payments. If you find yourself in the unfortunate position of owning two homes (more about this in Selling Your Home: Timing is Everything), you'll have to count on paying double house payments, utility bills, property taxes, and so forth, until the old house has been sold.
Settlement costs. Need we say more? Settlement costs average about 3 percent of your home's purchase price.
Repairs and maintenance. Your current home will need to pass an inspection in order to satisfy the buyer's mortgage company. You may not have minded the older fence around the pool, or the garage roof that looked like it might need replacing in a few years. If you're interested in keeping the deal together with the buyers, however, you may have to do a little upgrading and home improvement in order to pass the inspection.