Saving For A Down Payment

Nothing worth having ever came easy, and the same goes for home ownership. Saving for a down payment is a sacrifice worth making. It might not be easy, but it’s worth every saved penny.

Does the idea of saving potentially five, ten, or even twenty thousand dollars seem daunting? Read on for a few tips on getting the ball rolling.

How to Save Money for a House

Start small. Saving for a down payment doesn’t mean cutting out EVERY luxury and subsisting off of rice and beans. No, it can mean small, incremental changes. For example, take a look at your cable bill. Instead of paying $250 a month for thousands of channels you’ll never get a chance to watch, switch to a streaming service. Options like Amazon or Netflix offer endless options for a fraction of the cost. You could save almost $3,000 a year.

Look at how often you dine out. Say you go out for dinner three nights a week at $50 a pop. Cutting that down to one night a week saves $100 a week. Funnel that money into a savings account and you’ll rack up $5,200 in one year.

Waterfall your payments. If you’re focusing on saving for a home, you may also be doing things like paying off credit cards or getting out of debt. Take, for example, a $70 retail store charge card payment. You’ve just paid off the card but are accustomed to the $70 payment. Since you’re already used to making it, go ahead and funnel that $70 into your down payment savings account. It’s quick and painless.

Do Your Research

Remember, there are lots of mortgage options out there. You may not be tethered to the tried-and-true thought of needing 20 percent. With certain kinds of loans, like FHA, you may only need 3.5%. Other options, like a USDA loan, don’t require a down payment of any kind. Another option exists in down payment assistance programs. Depending on your city, state, or income, you may qualify. All it takes is a little digging to see what’s out there.

Once you’ve got the ball rolling on a down payment, the fun part starts… home shopping! Once you’ve reached this point, give us a call! We’d be glad to help you find your forever home.