With interest rates down, many savvy consumers are taking a good long look at investing in a home of their own. The benefits are big and the rewards of buying a home are long-reaching. For some consumers, a down payment is the only thing standing between them and the dream of home ownership.
In today’s economy, it’s not always easy to save the necessary funds to, not just get into a house of your own, but get a decent interest rate as well.
Here are some simple things you can put into your personal or family action plan for saving that down payment money in less time:
1. Get in the know.
Like any good budget or savings plan, the first place to start is to determine where you are now in relation to your credit score, monthly bills and assets. Contact us, or a trusted mortgage professional, to see how much of a home you can qualify for and how much you will need to save to purchase your home. We can help you take a look at things like credit scores and interest rates now so you can be simultaneously doing everything right during this savings period to ensure the most favorable rate and terms.
2. Set a deadline.
Deadlines can seem ominous to some, but they can be powerful motivators to accomplish great goals (and buying a home is a big goal!). Again, once you know where you are, it will make setting a timeline easier. For some, step one of the savings plan may be paying down or off some past debt with high interest, which could back up your time table. Together, we can help you figure out which direction is best for you.
3. Create a ‘down payment’ account.
Ever see those little ceramic banks with ‘house fund’ or ‘vacation fund’ on them or the piggy banks with ‘do not open until holiday shopping time’ on them? By opening a savings account just for your future home purchase, you help lessen the likelihood of tapping into that money for other things. Check with your bank, or even local credit unions, to see if they offer any special interest rates for home owners looking to buy.
4. Take a good long look at your monthly bills.
Do you have credit cards or revolving credit with high interest rates and high monthly payments? That’s doing two things to hurt your cause. First, those interest rates are costing you big and it’s just money out the door. Secondly, those high payments are bad news for your debt-to-income ratio. You may have to tackle those bills first and get them behind you. Make a list of your creditors, how much you owe, the interest rate, and the monthly payments.
To learn more helpful tips or to find out more about what CENTURY 21 Semiao & Associates can do for you, contact us!
