Real Estate Tips | Saving up for down payment
If you are thinking about purchasing a home in Baton Rouge but don’t know where to start, contact local real estate agent Sabrina Didier at 225-773-2352 for a FREE consultation!
Buying a house is most people’s biggest purchase ever. Many find that the hardest part is building up a down payment as most monthly mortgage payments are cheaper than monthly rent payments on comparable homes. Down payments can be as low as 3% of the total cost of the house, which is around $6,000 for the average home for sale in Baton Rouge or the surrounding area. Saving up approximately $6,000 or more if you want to have lower monthly payments can seem like an impossible goal. As with most goals, breaking things down into do-able tasks will make achieving what you want possible. Below are a few real estate tips and do-able tasks to help you when saving up for a down payment.
If you want to learn more about the home buying process, read more here.
Pay off debt – This may seem a little counter intuitive, after all you’re trying to save money, not get rid of it faster right? Paying off small debts may lower your debt to income ratio which may help you qualify for a lower interest rate which will save you money. This may also help you save up quicker once you knock out unnecessary debt and no longer have to make monthly payments on things like racked up credit cards. Instead you can take the money you were putting toward the debt every month toward your down payment savings
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Make a budget – How are you going to save money when you don’t know what is happening to each of your paychecks? One necessity to saving and owning a home is to live by a budget. Make a list of your “must” expenses such as food, utilities, transportation, and rent and a list of your “wants” such as entertainment money, eating out money, and random subscription money. If money is tight and you don’t know how you’re going to save up for a down payment, look at your “wants” list and see what you can sacrifice, even if its just a little bit, like seeing 2 movies a month instead of 4.
If you are an Baton Rouge resident and want to know how much your current Baton Rouge home is worth, contact Sabrina Didier at 225-773-2352.
Get a second job – For many this seems like an impossibility, but this doesn’t have to be an extra full or part time job. Even if you make a goal of doing enough side jobs for family or friends to earn $100 extra a month, it’s a step in the right direction. For those of you who do work part time, try your hardest to get another part time job or even a full time position instead to help you save up much quicker.
Sell unused items – Maybe you have just a few things around your place that you never use, maybe you have a big thing like an extra car. Whatever it may be, every little bit counts when saving up for a down payment.
Want to learn more on the state of the real estate market and community information? Contact Sabrina to find out more!
Get a room mate – Maybe one of your friends is looking for temporary housing, maybe a relative is in between selling a house and buying a new house. Whatever your options are look for ways to lower your “needs” expenses or at least share them with someone else.
Just Ask – You maybe able to lower your monthly insurance costs, medical insurance bills, cell phone plans, just by asking or threatening to leave and use another option that’s cheaper. Whatever it may be, many companies will try to keep your business by lowering the price of their goods and services – even by a little bit. If you get just a few dollars off a few of your monthly bills, that money will add up and help you have more money to put into your down payment fund.
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Saving up for a down payment will take focus and determination. It may take some people 6 months to save up for a down payment and for others it may take a few years. Be sure to consult a mortgage agent or real estate agent along the way. They will help you make realistic goals and may know of a few down payment assistance options that can help you collect your down payment much faster!
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