Save for a down payment. It will put you in a better cash position in case rates go up. It’s better to buy a home at a lower price and higher interest rate then a home at a higher price with lower interest rate, even if the monthly payment is the same. If rates go down you can refi, but your purchase price will stay the same. Also only your interest payment is higher, not your principal payment. Your taxes will be lower also. It’s also better when you go to sell. You don’t want to sell a home that cost you 600K for 500K even if your montly payment is low. Your cost basis is a lot more important than your monthly obligation.
