One of the issues that have come about
because of the housing crisis is the problem of saving for a down payment.
Buyers got spoiled to the idea that they could buy a home with 100% financing.
Of course, this was one reason they ended up underwater on their mortgages.
With the crisis came stricter requirements from lenders to qualify for homes.
One of those restrictions was a resurrection of higher down payments.
Back to the way it was
The idea of having 20% down to buy a home has halted a lot of
buyers, especially first-timers. However, this is not a new restriction. In
fact, back in the mid-20th century, 20% was considered reasonable
for a down payment. In fact, it was not uncommon for lenders to require 40-50%
down for financing. It’s just quite a change from where buyers were five or ten
years ago.
Fast forward to today
Today’s home buyers aren’t saving the money
they need to buy the homes they want. At least not at the level you would
expect. They aren’t ready to give up the other things on their list of
must-haves or just “I wants.” However, saving for that big purchase of a home
doesn’t have to be the impossibility that some people see. Here are some ways
that you can start saving for the down payment without giving up your latte.
·
Sell stuff – find things you
own that you no longer use, sell them and put the money in savings.
·
Delay other purchases – do you
really need that new living room set right now? Wouldn’t it look better in a
nice new home?
·
Freelance or take on a second
job – find something you like to do and charge for it. It may be babysitting,
designing brochures, or even teaching a class, but that extra cash can go into
your house fund.
Start saving up money to buy your first
home. Even if you could get a loan with no money down, just think about how far
ahead of the game you are with 10-20% down. If you have been saving and are
ready to make that big purchase, give me a call. I can help
you find the right house to fit your lifestyle and budget.
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