t's a question that vexes prospective homeowners everywhere: How much cash should I put down on my house? Sadly, there isn't one simple answer. The decision rests with your personal situation. By exploring some key elements, you can reach the answer that's right for you.

Looked at simply, the best combination is to put down between 20 percent and 30 percent of the purchase price. This lets get the best available mortgage rates, while allowing you (hopefully) to continue your long-term investment strategy.

Let's look at the arguments on both sides.

Proponents of a small down payment tout the benefits of "leverage," which allows you to use the home itself as collateral for its own acquisition loan (mortgage). Leverage, they proclaim with calculator in hand, helps maximize your investment results.

For example, let's say you put a $10,000 down payment on a $100,000 house. You sold it shortly thereafter for $125,000. With only $10,000 out of pocket, you more than doubled your money. Had you put a $50,000 cash down payment on that same house, and resold at a $25,000 gain, the return would be only 50 percent.

Many of these same people also talk about the "opportunity cost" associated with investing in a home. Say your home appreciates at an average annual rate of about 5 percent. During that same period, however, your investments in the stock market and elsewhere provide average annual returns of 9 percent. By investing only the smallest amount necessary in your home and adding more to you stock portfolio, you're able to make your money work for you, earning a better return. And with mortgage rates averaging around 7 percent, you even beat the interest rate you're paying on the loan.

A less investment-oriented reason for a small down payment is that many buyers don't have the cash to make a bigger one. Your options are to take out a big loan or to continue renting. You've done the calculations with Decision Center's Buy vs. Rent calculator and determined that you're better off becoming a homeowner.

So, if circumstances and investment savvy weigh on the side of making a small down payment, what's the argument for a large down payment?

Proponents of a large down payment point out that "you pay a price for everything." A smaller down payment means a bigger mortgage. A bigger mortgage means higher interest payments over longer periods of time. Every extra $1,000 that you finance for 30 years costs you $6.60 per month at a 7 percent interest rate. (That comes to $2,376 more in interest over the life of the loan for every additional $1,000 financed.)

Moreover, a buyer with less cash in a property has less equity and less reason to pay off the mortgage. This usually results in some costly guarantees in the form of private mortgage insurance or higher interest rates on a first or second mortgage.

Finally, cash is power. An all-cash or substantial cash offer can get you a better price. The seller has more confidence that you'll really close the deal and lenders are more willing to loan you money at favorable interest rates.

So how do you decide what's best for you? Consider the statements below and determine which ones most closely parallel your situation:

If you're most closely aligned with one or more of the first six statements, then you're probably better off making a minimal down payment. If you'd like some tips on how to get the house you want with a minimal amount, click here.

Meanwhile, if you were nodding your head over one or more of the sentences in Numbers 7 through 12, you're in the larger down payment camp. If you'd like to know how to use your larger down payment to your advantage, click here.