Your goal should be to minimize all non-principal/tax costs the first three years. So add them all up and take what’s better.
Don’t eat out, don’t get new furniture, do everything you can to pay in enough to stop paying PMI. You also should not assume “I hit 20% equity, no more PMI!”
In fact it is a pain to get PMI taken off of a loan, and it is easier to refi to a new loan when you hit 20% equity.
Then, once you have your house, push hard to make extra payments to hit that 20% asap. The refi has a double benefit (1) no PMI payments (2) the rate spread over the 10 Year Treasury itself goes down because a 20% down loan is more attractive than a 5% down loan.
This is what I did, and when I finally did my refi, my monthly payment went from 2450 to 1950. That’s $6000 a year less in housing costs going forward for decades. The refi itself was no-cost, they even did the appraisal for no charge.
