Buying your dream home can be one of the most complicated decisions to make in life. Starting from the location to the price, everything has to be thoroughly considered before making an offer. Home prices are on the higher side in southern California, which is why so many folks are trying to find creative ways to save money for their future home down payment.
5 EASY WAYS TO SAVE ON THE DOWN PAYMENT OF YOUR HOME:
Set goals to save on your down payment and plan other expenses accordingly. This helps you narrow down costs, and you might end up saving more than you expected. The usual recommendation is typically to pay 20% of the total home price as down payment, but lenders will settle for lesser rates so it is critical for you to make the correct decision. Research on whether your state or city has a low down payment policy for new homeowners.
Credit card bills need to be paid as soon as possible. Carrying a balance into the next month will weigh down on you every month. If you’ve got a balance, pay it down as soon as possible, starting with either the lowest amount owed or the highest interest rate. Try to stick to using only one credit card too, only use the one with the best rewards and lowest interest rates.
Cut down on luxury spending. For example, avoid spending on things that you know you don’t need and you can do without. Splurging needs to take a back seat for a while; keep in mind that owning a home will reap you benefits in the long run. Don’t chicken out on this one, really examine your expenses and figure out what you can cut out. You’d be surprised what you’re spending on that morning cup of coffee when you think of it on a monthly basis. Are you really watching all those channels? If you’re eating out more than two times a week, try eating learning a few easy to cook meals that you find satisfying.
Set up fixed deposits or other pre-determined savings which are automatically deducted from income every month can help you a great deal when you need quick money for down payment purposes. The down payment for your dream home is definitely a worthy investment to funnel your savings into. Generally, most individuals save a significant amount of money to invest in situations like buying a home or a car, 401ks and IRAs may actually come in for these types of purchases, allowing you to barrow from your own money and still earning an interest in many cases. Ask your local bank for more details.
Save the extra money that you earn from raises, bonuses, or other incentives. It might seem like a meager amount in the beginning, but the cumulative sum will serve a more significant purpose and will happen faster than you might imagine.