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Saving for a down payment is one of the big challenges of buying a home. If you want the best possible loan to buy the house you want, having money set aside for the down payment makes all the difference. There are some strategies, though, that can help speed the process and get you where you want to be. Here are a few to consider:
Look At Your Budget
Take an inventory of your current budget. Look at your spending habits and find out which expenses are necessities, and which are not. Prioritizing your budget can be a big help with freeing up some money to apply to a down payment. If you’re serious about owning your own home, then it becomes easier to sacrifice some of the things you’ve gotten into the habit of spending money on. List the essentials, and then begin removing the things that don’t make that list. You should also figure out how much you should be saving each month to meet your down payment goal.
Consider a Side Hustle
It might not be enough to readjust your budget, and a side hustle might help you get to make faster progress. What skills do you have? How much extra time do you have available? A second full-time job isn’t realistic, but doing a money-making job on the side can be very helpful in adding to your savings. It could be driving for Lyft, selling crafts, writing, or tutoring. Anything that can help you bring in additional income each month. Many jobs like those allow you to create your own schedule, so you can fit it into your schedule as you see fit. If you can’t get your budget to add up the way you want it to, a side hustle might be just the thing you need.
Automate Your Savings
If you don’t currently save money each month, automating your savings can be a terrific strategy to help you meet your goals. Instead of having to transfer money manually into a savings account each month, you can set it up to happen automatically. Once you make sure you’re putting the minimum amount you need away each month, you’ll have a great strategy in place to keep making progress, month after month. Whenever you have a surplus at the end of the month, you can add that too.
Make a Plan
Depending on where you start, saving for a down payment might take some time, but having a plan can make it easier to stay on track. Figure out how long it will take to meet your goal, then begin tracking your progress. It’s also worth researching the different loan programs that you may qualify for. There may be an appealing option that doesn’t require the standard 20% down payment. Consulting with a loan officer will help you understand your options, without having to make any commitments.
These ideas will help you create a strategy to help you meet your financial goals, so you’re ready to make a down payment when the time is right.
If you’d like to talk more about this, or if we can help you understand your mortgage options, please reach out to us. We’re always happy to help.