Tips For Saving For A Down Payment

Are you tired of renting and ready to take the steps to buy your own home? Shopping for your dream home and saving up enough funds for the down payment is a monumental milestone, but saving up an adequate amount of money for a down payment can seem like a major obstacle that many home buyers face. Although it might take some time and planning, there are several steps you can take to begin the process of owning your dream home, starting with your down payment. If you are interested in buying a property in the areas of West Palm Beach, St. Pierce, or Tampa Bay, Florida, CTC Mortgage is here to help you with the process. Continue reading to learn some tips to help you save up for a down payment on your future home.

Determining The Amount You Will Need For A Down Payment

When making a down payment on a home, the more a borrower is able to pay up front for the down payment, the lower the monthly loan payment amount and the overall loan amount will be, which will save a homebuyer a significant amount of money throughout the life of the loan. A down payment of twenty percent or higher is ideal when purchasing a home because private mortgage insurance payments are not required with twenty percent down. However, even if a borrower cannot afford to put twenty percent down, there are still many mortgage options available to help finance a property. Many conventional loans are available that allow you to purchase a home with a down payment between three to fifteen percent down. There are also non-conventional loans backed by the federal government that require low or no down payments, including FHA loans, that offer down payments of 3.5 percent and have lenient credit requirements, USDA loans for borrowers looking to buy a home in a rural area that do not require a down payment, and VA loans for veterans and military service members that also have a zero down payment.

Strategies For Saving For A Down Payment

In order to save enough funds to make a sufficient down payment, there are several steps you can begin to take, including:

• Paying off any current debt, such as credit cards, car payments, student loans, etc. to help you avoid interest rate charges.
• Decrease any spending that is not essential, such as eating out, expensive vacations, buying clothes and jewelry, etc.
• Create a savings account that has a good interest rate and set aside a specified amount of money each month. It is advisable to have those funds automatically transferred from your paycheck into your savings account every month.
• Get an additional job to help earn supplemental funds, and then set aside those earnings towards your down payment.

If you are ready to purchase a home in West Palm Beach, St. Pierce, or Tampa Bay, Florida, contact CTC Mortgage today for a consultation.

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