Let's look at the difference in the monthly payment that changes in interest rates will make. (See graphic below.) As interest rates climb, the amount of house you qualify for will likely go down. More importantly, though, would you be comfortable with the higher monthly payment? 

The graphic shows estimated payments under different loan programs for 30 year fixed rate mortgage. The sales price is the May, 2014 average price in San Antonio according to the Board of Realtors. 

This graphic also points out the benefit of having money to put down. Even though the interest rate is higher on a conventional loan, the 10% cash down makes the monthly payment lower because of the loan amount. In a similar way, paying cash instead of rolling fees into the loan if at all possible is advisable.