You can’t know whether $20k is a reasonable amount if you have no idea at what price the house will likely sell.
Ask for a real estate agent that specializes in the area to appraise the house given the current housing market and recent comparable sales.
It’s kind of already been covered, but in the UK in 2009, having 20% to put down as a deposit on a house would get you a much lower mortgage interest rate than if you only had 10% to put down. And if the OP had no principal whatsoever (I know this was not necessarily the case), she presumably wouldn’t have been able to buy a house at all. So although she has paid more in monetary terms over the last 3 years, once the above has been factored in I think asking for more than 50% of the proceeds would perhaps be a little presumptuous.
LOL. And yeah, those first few years you pay virtually no principal.
To illustrate, I plugged 120,000 and 6% into a calculator at bankrate.com. In 3.5 years the principal would have been reduced just to 114,000 (on a monthly payment of 720.00). Adding in taxes and insurance and other such things, that 720,000 could easily be 1,000 a month, which adds up to 42,000.