June 07, 2016
June 07, 2016
There’s no sugar coating it: a house is a big purchase. And, to make a good dent in it, you want to start off with a solid down payment. (Although, there are other options that don’t require as large of a down payment, so don’t think a large down payment is the only option.) So how do you figure out how much to put down?
Start here. This whole process begins with figuring out what you can afford. Your down payment is based on the mortgage type you choose and the monthly payments you’ll be signing on for. First, identify what kind of mortgage you’re looking for. There are plenty of free, online calculators that can help give you an idea of what you’ll pay month-to-month.
Start packing it away. Most lenders require a certain level of down payment to qualify for a mortgage. This can range from five to 25 percent. The larger the down payment, the more comfortable they will be giving you a mortgage. That being said, think about the future…and all the things you’ll want for the house once you move in! You might want to paint, buy new furniture or update the carpeting. Don’t stretch yourself too thin.
So, how do you do it all? Here are a few ways to prepare for that down payment:
Buying a home is a big decision, financially and emotionally. But, if you do the legwork to determine what mortgage option will work for you, and think through strategies to help save for a down payment, it’s a goal that’s within reach. Just take it one step at a time.