You’ve talked to your family and have made the decision to buy a home. This means that you won’t have to throw money away on rental payments each month. However, you’re going to need to provide a down payment for the house that you want to get. You may have heard that a standard mortgage will typically require that you have 20% of the purchase price as a downpayment. But a good real estate agent will tell you that there are ways that you can have 10%, 5% or for first time home buyers 3% for your down payment. And it is even possible for Veterans to pay Zero percent down.
The following are a few ways that you can cut back on your budget so that you can save money in a short time for the house that you desire.
Going Out
Taking your family out to eat or to various attractions in your town can be fun and exciting. However, the money that is spent on these activities can be saved to go toward your down payment. Prepare more meals at home as a family. Find games and activities that you can do in the evening and on the weekend. Some options include a movie night with popcorn or games that you set up outside in the yard. Invite some of the neighbors over as well for more fun and so that you get to know the people around you.
Lower Rates
Talk to several banks and lending agencies about ways that you can get a lower interest rate or lower down payment. While saving money for the down payment, try to get your credit score as high as possible as this can result in a lower interest rate as well.
Save Bonus Payments
Any extra money that you receive that you don’t expect can be saved instead of spent on extras for your family. You might get money as a birthday gift, a year end bonus, tax refund or a rebate payment after purchasing an appliance. Another option is to look for products and services that offer rebates so that you do get money back from the purchase.
Cut Ties
If you really want to buy a home that you’ll own, then consider cutting back on some of the utilities that you have. You’re going to need electricity, but don’t leave lights on when you’re not in the room. Cut out extra cable channels or internet services that you don’t need. Lower your phone payment by getting a phone plan for the family instead of paying for each line separately.
When you set a budget that your family can stick with and that is clearly posted in your home, then it’s often easier to save the money needed for a down payment on a home that you want. Start small by cutting out a few expenses that you don’t really need. Once you begin seeing your savings increase, then it can be a motivation to cut back even more each month.
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