You want to get into your new home but you need to save more money, we get it. In the mar-ket we are in now, cash offers are more valuable than ever to win out on bids and get your dream home. However, if you don’t want to wait until you can do a full cash offer and just want to save for the down payment, closing costs, etc., we want to give you tips and tricks to saving more money and saving it faster! Keep reading on for more.
YOU DON’T HAVE TO SAVE 20%
The common myth in homebuying is that you have to save 20% for the down payment. I mean sure, if you want to avoid the PMI (private mortgage insurance), the 20% is vital, however, it isnt required to get into a home. From the down payment, to closing costs,etc., we recommend saving about 10% of the purchase price, so if you get prequalified for a 300K home, aim to save $30,000.
You also want to take the time to look at all your expenses and see what monthly subscrip-tions you can cut at least until you get your home. Improve your DTI (Debt to Income Ratio) to increase the amount of money you can save from your paychecks.Doing this could save you hundreds a year. You also want to set a goal. How much do you want to save and what amount of time do you want to save it? (For example, saving 30K over 5 years). Setting this expectation will not only motivate you to get it done, but then it will give you a good idea of when you can start really looking for homes.
ASK FOR A RAISE OR GET A NEW JOB
Our first tip is finding a way to bring home more money. Maybe it is time to apply for a higher position, or maybe you have been in your current job for some time and it’s the perfect time to ask for a raise. Regardless, have a feasible goal of how much you want to make and then work towards that. If you have a spouse, encourage them to do the same so that you can both bring home more to save more. Once you are making that extra money, set a goal of what percent-age of your checks that you will be saving and stay disciplined!
PICK UP A SIDE HUSTLE
Do you have a specific skill that you can get a second job doing, or want to pick up a new skill? Having a side hustle could be a great way to bring in another source of income into the mix and really fast track your savings goals. Do your research on estimated profit for whatever side hustle you decide to do and match it up with your desired savings goals.
RENT OUT A ROOM OR A PORTION OF YOUR GARAGE
A great way to make more money and have a side hustle is to rent out a spare room in your current home on Airbnb (if possible), or if you have a garage that is fairly empty, you can actu-ally get some extra cash via an app that gives people the opportunity to store some of their stuff in your garage. This will be especially great if you live in an area that maybe homes or apartments are smaller (i.e. New York) and there is a high demand for storage facilities. As an added bonus, maybe put your car on Turo on your off days to allow people to rent out your car
for short trips.
RESEARCH FIRST TIME HOMEBUYER PROGRAMS
If this will be your first home, there are a lot of first time homebuyer assistance programs out there to help you with your down payment! Research what programs are out there, and their qualifications. Also get some feedback from your realtor about available programs, because they may give you more insight from your research!
DONT BE AFRAID TO ASK FOR HELP
Your family and friends may want to assist you with getting you into a home! Dont be afraid to set up a GoFundme or to ask people directly to donate to the cause some other way. Maybe even host a garage sale to put all the proceeds towards your housing fund and encourage your family and friends to come out! You will be surprised how much others will want to help you achieve some of your life goals.
There are so many ways to generate money to save for your house. From renting things out, getting a new job, asking for help etc., these are only a few ways out of hundreds to save more money. We want to encourage you to stick to your savings goals and really discipline yourself to achieve the goals in that designated time, but also don’t be too hard on yourself if you back track once or twice. Saving money for such a big purchase takes time, so having the patience to achieve that goal is also vital to helping you stay focused. Now get out there and start