5 Tips For Saving For Your First Home

Austin and I are currently saving up to buy a house here in the Dallas area. It takes a lot of time and planning to make that happen, especially if you don’t have the proceeds from the sale of another home. These days, getting 100% financing if very hard to come by, so you’ll have to come up with the money for closing. 

I invited Caitlin Wilker on to share a few of her top tips for saving up to buy your first home. Or, in our case, your third home! No matter how many times you’ve purchased a home, you may still need to come up with the closing costs. 

Here’s what she has to say-

When the wedding planning has finally come to an end, you and your newly married spouse need something to look forward too? What about big dreams of owning your own home one day? When it comes to saving money for a home, debt can play a huge factor and can even be laughable that it might not happen. Below are a few tips to help you save money for your first home as well as meet a goal. 

1. Make A Budget Your Top Priority

Prior to even looking at homes, decide what you can comfortably afford together. The bank may give you a number to distract you from what you can actually afford. Look at the mortgage, property taxes and your home insurance. This, in the long run, can help add several hundred dollars to your total mortgage overall. 

Figuring out what you can accord and then decide on how much you need for a downpayment is critical. When it comes to having a large sum of money, ideally you should have about 20% to put down to avoid paying private mortgage insurance. If you live in a higher cost of living, you also need to have a solid credit score. You can mostly still qualify for good mortgage loans with at least 10% down too. 

2. Pay Yourself First 

Many people wait until they get a paycheck at the end of the month to see how much money they have leftover before putting any money into savings. This is actually a terrible way to do that because after everything is said and done, you don’t have any money left over. 

How can you fix this problem? If you really want to get serious about saving, you’ll need to calculate how much money you can put into savings first. At first, this might be a little getting used to but once you start putting the money away, you’ll learn to get used to it. If you feel like you need to get help to not touch the money, get a separate account so you don’t touch it and pretend it’s not there. 

3. Get Debt Out 

The general rule of thumb is that your housing cost should never exceed a third of your total income. However, if you have other debts such as a car loan, student loans or credit cards. Consider paying down some of your debt first, which will not only help alleviate some of the financial pressure but also help you secure a better mortgage. 

When you have debt paid off, this, in turn, can help you save hundreds if not thousands of dollars to free you and help you save faster! 

4. Reduce Your Overall Expenses 

For almost a year before you actually bought our dream home, we began living as if we already had a mortgage to pay. This means we put the difference between the rent and an assumed future mortgage payment into your savings account. 

Starting this habit helps you pay off a bigger mortgage and the bonus is that you’re also saying towards your home. It also showed us that we also needed to reduce our budget as well. If your budget is $300, reduce it to a smaller budget. Although it’s not a huge difference of maybe $50, the money will add up when you apply this to all of the expenses you have. 

Image: AON Innovation 

5. Consider The Additional Costs

Once you find a few local listings and visit your home you’re excited for, also take a look at any additional costs it might affect for you and your spouse. For instance, if you see that the front door needs work, you should hire a local company near you to repair it. AON Innovation, a door refinishing company in Allen, Texas, says that the sun can cause the paint on a door to crack. 

If you think you’ll need several repairs, it’s always good to look for a company like AON, because they can handle many areas of your home. They are committed to being the perfect team to hire for any small or large projects you see to get your dream home the way you want to. They focus on drywall, sheetrock, painting and even the entrance of your front door brand new again. 

You want a company that is professional when they are looking at your home, help answer any questions or concerns you have to make sure you are satisfied with their work. 

Your Hard Work Will Pay Off!

Saving for a home can be a stressful time but also such an exciting time for you and your spouse. Save what you can, do your best and know that this dream can become a reality for you! If you need to say no to a few things to help save, make this a fun time for you! 

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