Save For A Down Payment

Are you a Veteran? Guess what, if you use your VA entitlement, you DO NOT have to have a down payment in almost all instances. But, if you are planning on buying, it is still important to follow these steps to save your money. Here are the top 5 ways to save while renting.

1. Pay Down Credit Card Debt.

Credit cards are one of the best/worst things invented! They can be extremely helpful and useful for certain things. But they are not meant to be used when you don’t have the money to pay off the card. If this happens the debt piles up. If you are planning on saving for a home Veteran or not, it’s important to pay off your credit card debt first. Because of the high interest on credit cards, you will be paying more on your credit cards than you will be putting into your savings. Once the debt is paid off, you will have more money to set aside and build your savings and down payment.

2. Save your Tax Refund

If your goal is to buy a home this year, save your Tax Refund! It is almost that time to file your taxes and the average amount returned is about $3,100 according to IRS data. If you are getting a check this year and you plan on buying, don’t spend it, save it and use it for your downpayment towards the house or the fees.

3. Automate Your Savings

Is it hard to save money? Don’t worry, it’s hard for everyone. But luckily we live in a time where there are ways and technologies that can help us save automatically without thinking. Most of your mobile banking apps have options to have a set amount transferred to your savings account automatically on the same day each month. Or there are other apps out there that will help you save automatically. They can analyze your spending and save what you don’t use, or they can round every purchase you make to the nearest dollar and save that extra change every time you spend money. Look into these fantastic ways to save without even noticing.

4. Scale Back the Wants.

We all have those things that we love and want. For example things like our daily coffee at Starbucks, happy hour, fast food, shopping, and dining out. Indulging in things like this all the time can cost you hundreds if not thousands of dollars every year. If you are serious about buying a house downpayment or not, it’s important to put these wants on the back burner until you get into your new house!

5. Trim The Fat

This is the something you can do while sitting on the couch watching TV. When “trimming the fat” think about what you are spending your money on. Specifically, think about your subscriptions. Do you have a gym membership, music subscription, or magazine subscription? If you have any type of subscription, think about if you use it consistently, or if you really need it. Getting rid of these types of recurring expenses help save the average person $50 a month!

Final Thoughts

No matter what type of loan you plan on getting, VA or not, it is important to follow these steps not only for a down payment but for the underwriting process. You will have a better chance of qualifying for your home loan if you have your spending in check and your savings built. Good luck, and as always, if you have any questions please give us a call, 360.571.LOAN or email us at GreenwaldTeam@Creeksidem.com.  Here is our contact page in case you need more information about us.