top of page

Budgeting and Saving for a House Down Payment

  • Writer: David Cade
    David Cade
  • Oct 28, 2021
  • 2 min read


Prior to buying a home, you need to assess the amount and source of your down payment funds and check in with a lender of choice to determine what kind of loan is best for you. You should work on getting your credit score as high as possible and create a reasonable budget so you can save the needed down payment funds.


There are programs that will help keep the size of your down payment to only 3.5 percent of the purchase price. In some cases, with lender-required education, there may be no down payment required.


Plan on buying a home that fits your savings plan of an amount equal to 3.5 percent of the price. You can always move up to a larger home later as your equity grows.


It is not uncommon for all or part of a down payment to be gifted from a family member. This option may allow you to buy a home sooner than expected because your funds are immediately available.


To help save money to buy a home, have your bank set up an automated transfer of at least 10 percent from every paycheck to a separate account that is reserved for your down payment funds.


Have your budgeting plan include reducing some of your more luxurious indulgences. Eat out less often, shop for more affordable getaways, and evaluate how much you are spending on items you could really live without.


If you can find a way to increase your income, even if only temporarily, your down payment fund will grow even more quickly. You may have a hobby that could be a marketable commodity, or freelancing your skills could supplement your income.


Feel free to reach out to learn how you can put yourself in the best possible position to purchase a home.

 
 
 

Comments


  • White Facebook Icon

918 Lily Creek Road Suite 202 Louisville KY 40243

2025 Fair Way Lending LLC NMLS 1308033

NMLSConsumerAccess.org

Privacy Policy

MB.6761226 NMLS ID 1308033
Fair Way Lending LLC
Illinois Residential Mortgage Licensee
Illinois Department of Financial and Professional Regulation (IDFPR)
Division of Banking. Bureau of Residential Finance
555 West Monroe Street Suite 500 Chicago Illinois 60661
General Inquires: 1-888-473-4858  TYY: 1-866-325-4949
Springfield Office Line for Banking: (217) 785-2900
Chicago Office Line of Banking : (312) 793-7090
Website: https://idfpr.illinois.gov

USDA-Home-Loan
HUD-Seal
VA-Lender
freddie-mac-fannie-mae-new-loan
eqhl
bottom of page