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June is American Housing Month: 6 Tips for Saving for Your Down Payment
Owning your home is often more affordable than renting. Many home purchases require a down payment of 5-20% of the home’s value. In honor of American Housing month, First State Bank and The American Bankers Association provide these tips to help you save for your down payment:
Develop a budget & timeline. Consult with a First State Bank loan officer to determine how much you’ll need for a down payment. Create a budget and calculate how much you can realistically save each month.
Establish a separate savings account. Set up a separate savings account exclusively for your down payment and make your monthly contributions automatic. By keeping this money separate, you’ll be less likely to tap into it when you’re tight on cash.
Shop around to reduce major monthly expenses. It’s a good idea to check rates for your car insurance, health insurance, cable, Internet or cell phone plan. There may be deals or promotions available that allow you to save hundreds of dollars by adjusting your contracts.
Monitor your spending. With online banking, keeping an eye on your spending is easier than ever. Track where most of your discretionary income is going and identify areas where you could cut back (meals out, vacations, etc.) and instead put that money into savings.
Look into state and local home-buying programs. Many states, counties and local governments operate programs for first-time homebuyers. Some programs offer housing discounts, while others provide down payment loans or grants. Your First State Bank loan officer will determine if you qualify for any down payment or closing cost assistance programs.
Celebrate savings milestones. Saving enough for a down payment can be daunting. To avoid getting discouraged, break it into smaller goals and reward yourself when you reach each. This will help you stay motivated throughout the process.
Ready to get started? Contact First State Bank Mortgage today and we will guide you through the process.