Faced with an increasingly competitive housing market, homebuyers increased the size of their down payments on home purchases.
U.S. mortgage borrowers who purchased a house during the third quarter made an average down payment of 17.63 percent.
Down payments, which are based on conventional 30-year mortgage transactions, were up from 17.34 percent the prior quarter.
That is according to a report released Wednesday by LendingTree.
An even bigger increase in down payments has been made compared to the third-quarter 2014, when the average was 16.29 percent.
LendingTree Founder and Chief Executive Officer Doug Lebda attributed the rise to growing competition in the housing market.
“In competitive housing markets, homebuyers will often bolster their buying credentials by offering a larger down payment,” Lebda said in the report. “Not only could this improve a buyer’s chances of securing the home, but could also help avoid delays in closing, create built-in equity and generate lower monthly payments.”
When also considering jumbo mortgages, nonprime loans and home loans insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs — the second-quarter 2015 average was just 15.41 percent.
In Mississippi, the average down payment on conventional loans was 14.88 percent during the most-recent period — less than any other state.
Alabama followed at 15.02 percent, then 15.11 percent in West Virginia, 15.19 percent in Iowa and 15.21 percent in Kentucky.
At 20.38 percent, New York had the highest average.
