Extra 5% down for .375% rate savings?

[Mark S.]

Buying a turnkey rental and the lender has proposed the two options below. Part of me says the tenant is ultimately paying off the loan, so who cares? Take the extra 5% down and use that $4K or so as down payment on the next one. The other part of me says, it's ONLY $4K and feels like a sucker locking in north of 5.00% interest in this environment. Take the extra $36/mo cash flow and essentially "break even" in about 9.5 years. What do you guys think? Rates for the 30 year fixed mortgage are as follows: 20% Down Loan Amount $67,200.00 Rate: 5.125% P&I $365.90 Insurance $45 Taxes $85 25% Down Loan Amount $63,000.00 P&I $329 Rate: 4.75% Insurance $45 Taxes $85