So, you are looking at Orlando real estate listings?
Have you saved enough for the down payment before you set your heart on the house? Typically, it’s 20% of the house’s price. However, if you opt for a loan provided by the government, it’s around 3.5%. The latter option has pretty stringent requirements, so most people opt for independent lenders.
This means you need to make some important and hard decisions regarding your spending habits. You will have to limit eating out or going to happy hour with your colleagues for a while.
So, much down payment are we looking at? Let’s say you are buying a house that is worth $240,000. A 20% down payment for this house would be $48,000. That’s a huge amount that might take time to save. Yes, it is challenging, but you can meet your goal within a set time frame if you curb your spending habits.
Here are a few tips on how to save for a down payment:
Look for a Side Hustle
What are you good at? Can you utilize your unique skill set to earn a little extra on the side? Whether babysitting, dog walking or delivering groceries for the elderly, jump at an opportunity that won’t drain you after your 9-to-5 job.
Hold a Garage Sale
We are sure that you have plenty of things lying around in your house that you don’t use. Why not gather them all and hold a garage sale? This will help you add to your down payment and declutter your home.
Reduce Your Retirement Savings
This might sound a little odd to you, but cutting back on your retirement savings for a while will allow you to contribute more to the down payment. You can also look into an IRA for $10,000 without paying the penalty. We are not saying that you abandon your retirement fund but consult a tax professional to help you with this.
Buy Used Items
Thrift shopping is the best way to spend less. Of course, we want you to stop spending on frivolous things altogether but if you find the need to buy some clothes or shoes for a reason, go for used goods.
Cook More
Limit your outdoor dinner or takeout to once a month; set an eating out amount on it. It might feel like you are being a cheapskate in front of your friends, but we say keep your eyes on the prize.
When you are saving for a down payment, even spending pennies on a bagel or scone feels like splurging. So, instead of jumping headfirst, we suggest you create a plan.
If you are ready to buy a house, talk to a Dr. Phillips Realtor to learn the best course of action. Get in touch with a qualified Orlando real estate agent by visiting Megan Dowdy Realty. For further information, call 407-509-9279.
