Buying a new home is an exciting investment! Whether you’re planning on purchasing a new home this summer or you’re starting to think about the future, saving up for a down payment is a crucial part of your home-buying journey. Read on to learn more about the benefits of a down payment and some top tips on how to save.
Why do you need a down payment?
Saving up for a down payment signifies that you are ready for the financial responsibility of owning a home. As a homeowner, you are accountable for many additional expenses—such as property tax, maintenance, and more. By saving for a down payment, you’re demonstrating an ability to manage your finances and save for the future. Providing a down payment also lowers the total amount of your mortgage, reducing the amount you owe over time.
Top Tips to Help You Save for a Down Payment
Figure Out How Much You Need
Even if you’re just starting out, it can be beneficial to consult with a licensed mortgage professional to learn more about what you can expect throughout the homebuying process. Our team of experts will walk you through the different types of mortgages available, learn more about your financial situation and advise you on how much of a down payment you should prepare for.
Break Your Target into Small, Achievable Goals
A large target can often seem overwhelming. Break your large goal into smaller, more achievable goals and spread them out over your desired timeframe. For example, if your target down payment is $50,000 and you want to be able to purchase a home within 5 years, you should plan to save $10,000 per year—or $840 per month.
Create a Budget and Stick to It
Once you have your monthly goal, it’s time to start saving! Take a close look at your finances and see if there are areas where you can cut back your spending, such as making food at home instead of ordering take-out or choosing to take a vacation closer to home.
At Lynx Mortgage Bank LLC, our goal is to help homeowners in Long Island, NY, navigate the home buying process with ease. If you’re considering purchasing a home, our expert team of mortgage professionals is here to help. Call 877-599-LYNX today to get started!