Skip to main content

HOW TO MAKE A DOWN PAYMENT POSSIBLE

Does the prospect of a big down payment make home ownership seem impossible? It’s not as out of reach as you might think. Here are five tips to help you climb the down payment mountain.

Every month you pay the rent, you’re probably thinking, “I wish this money was going into my future.” For a lot of would-be first-time home buyers, it’s the down payment which makes home ownership seem impossible. Climbing the “down payment mountain” isn’t impossible. Like any major challenge, it’s all a matter of breaking your big, hairy, audacious goal down into practical steps.

Here are some tips to conquer saving for a down payment:

Find out where your money goes. You can’t start saving if you don’t know where you’re spending. For a month or two, track each expenditure, no matter how small. Get an objective picture of where you’re spending the cash.

Get specific about how much you need to save. Even if you’re not 100% sure what your down payment needs to be yet, it’s good to start doing a little math to figure out how much you need to save. Pick a dollar amount and a timeline to hit that dollar amount. For example, a $25,000 down payment in two years comes to $1,041/month. Sound unrealistic? Either scale down your home desires to something smaller or scale up your timeline. If you can wait three years, that monthly savings goal drops to $694/month.

Determine the big moves you can make. If you’re in a three bedroom apartment and can stomach the idea of scaling down to a one bedroom, how much would you save in rent? What about going from two cars down to one? If you can make it work, these sacrifices will have a huge impact on your savings goals.

Setup a separate savings account. Don’t let your dream home money mingle with your regular checking or savings account. Establish a high-yield savings account with a credit union or money market account to protect and build your stash. It’s important to have a separate account with a “hands off” attitude.

Mind the risky investment schemes. Once you have a little momentum, you might be tempted to take some of that cash and invest it in order to make it grow faster. Be very prudent about this, as investing in stocks, startups, or high-yield funds can easily decimate your savings. Be conservative.

Of course, it’s important to know how much home you want to buy when you’re saving up for your down payment. I’m happy to give you an idea what homes are selling for in your area. 

Feel free to get in touch any time if you have questions: valerie@valeriemcconville.com

Comments

Popular posts from this blog

4 TIPS FOR A PRODUCTIVE 2021

  4 Tips for a Productive 2021 (Family Features) This year has taught many workers a thing or two about being productive when offices and homes blend into one. As the calendar turns to 2021, consider these key products and processes to stay productive next year. Find a system (and stick to it): Creating an organizing system is an easy way to ensure your at-home workspace is ready for optimal productivity. Designate space to house all your work items – a drawer, cabinet or box – and keep work items organized by type (pens, papers, computer gear, etc.) At the end of each day, transitioning to “offline hours” can be easier when you have a place to stow your work items. Start your day clean: Studies have shown cleanliness has a direct impact on productivity. Yet, many people struggle to find the time and energy to clean, especially at the end of a busy day at home. An option like The DEEBOT T8 from Ecovacs provides a hands-free cleaning experien...

UNDERSTANDING HOW POCKET LISTINGS WORK

Have you ever wondered what a “pocket listing” is?  Learn a little bit about this trend in hot markets and how an agent familiar with pocket listings can help you sell your home faster or find homes which haven’t hit the market yet. If you’ve been searching for a home or have been considering selling your home, you may have heard the term “pocket listings” from real estate agents or even friends and family. What is a pocket listing? Where did the term come from? How are pocket listings being used today to buy and sell homes? Pocket listings are homes which are for sale but not yet widely advertised or entered into typical MLS databases. Often an agent will enter into an agreement to sell a home, but will first reach out to their personal and professional network to see if anyone may be interested in a quick, private purchase. Ideally, the agent knows someone or another agent who has a client interested in the home and the whole process of listing and marketing the ho...

UNDERSTANDING MULTIPLE OFFER SITUATIONS

In a seller’s market, multiple offers are not uncommon. But what does that really mean?  And how should you and your agent work together to generate the most interest in a multiple offer situation? Find out more in my post…  When inventory is tight and a market heats up, sellers often dream of finding themselves in a multiple offer situation. In a multiple offer situation, more than one potential buyer submits a written offer on the home. With multiple offers on a property, the listing agent can then try and “shop the top offer” in order to try and get the best deal possible for their client. If you live in a hot market, how do you structure your listing in such a way that you get the best possible offers in a multiple offer situation? One strategy for cultivating multiple offers is letting buyers know that the seller will only entertain offers on a certain date. Rather than deal with offers dribbling in one at a time, there’s a deadline for offers. When thi...