How to Save Money for a House

Many people like yourself are looking for ways to save money for a new home. Sometimes, it can start to feel like you don’t have enough money for a down payment.

If you are concerned about saving up money, you aren’t alone. Coming up with the money for a down payment can be one of the most intimidating parts of the process for anyone who hopes to become a homeowner. However, it can be done when the right tools and strategies are in place.

So, what is a down payment? A down payment is the cash you bring to the closing table when buying a house. The payment typically represents the percentage of the full house purchase price. For example, homebuyers typically put down payments from 5% to 20% of the total value of the home, while the rest is often financed through a loan.

The key to save money for a down payment is being strategic with your goals and cutting back your expenses. Here are 3 ways you can begin saving for your dream house today.

Track your spending and expenses

It’s all about lifestyle changes! It’s easier to spend money on specific items you purchase and, over time, it can really add up. The first step is figuring out where your money goes and how to keep more of it in the bank. 

·         Start a coin jar. Saving all your loose change can have a big impact.

·         Packing your lunch can save you about $60 a month. By the end of the year, you’ll save $720.

·         Replace your $100 monthly cable service with a $12 Netflix standard streaming account. You’ll save $1,056 a year.

·         Replace your $150 lavish gym membership, such as Lifetime with a $10 Planet Fitness gym. You’ll save $1,680 a year.

·         Going out for dinner and drinks can add up. If you typically spend $30 three times a week, try to reduce to once a week. You’ll save up to $720.

If you’re with a significant other and wanting to move in together, try to team up! With all of the above, you and your significant other would be able to save up to $9,152.

Open and automate your savings account

When you open a savings account, some bank account can offer 1.65% APY or higher. This is a great opportunity to get your savings started.

Once you set up your savings account, make sure to automate it monthly. This way part of your paycheck will automatically go into your savings account before you are tempted to spend on unnecessary things.  This small step will make a huge difference in your savings!

Look for ways to boost your income

If you already have a typical 9 to 5 job, we suggest starting a side hustle. There’s few examples of ways to earn money such:

·         Babysitting

·         Dog walking

·         Selling artwork

·         Freelance writing

·         Freelance photography

·         Driving Uber/Lyft

·         Serving

·         Tutoring

If you decide to branch out and a find a new job altogether, think about the skills or talents that you could parlay into freelance income. You may be surprised by what your talents are.

Once you saved up money for your dream house, don’t hesitate to reach out to a mortgage professional! We’ll happy to help you make the right decision. We look forward to hearing from you!

Should You Buy or Build a House?

As you start to search for your dream home, you may be open to the range of options. One of those choices you may face is deciding on whether to buy or build your own. Each option has its pros and cons. For instance, building a home gives you the opportunity to customize a floor plan, however it will take months to construct. If you buy a home, you will have to compromise on the floor plan, but you might be able to move in quicker.

Before you decide on your dream home, let’s compare the two.

Building a House

What are some advantages of building a home?

·         Discounts on materials

Believe it or not, building a home can come with many benefits and opportunities to save money. When working with the suppliers, some suppliers will offer higher discounts the more you’re willing to buy.

·         Everything is new

All the technology is up to date and you hopefully won’t have to worry about repairs right away. Overall, everything in the house is in good working order.

·         Design control

Everything is what you want from the start.

Disadvantage of building a home:

·         Time

The time it takes to build a house takes an average of seven months. This means you will be staying at your old home for quite some time or at a temporary place until its finished.

·         Limitations

Although you can customize your home details to suit your taste of style, upgrades can be a bit pricey.  

Buying a House

What are some advantages of buying a home?

·         Opportunity to flip a home

If you bought a home that needs some renovation, you have the potential to flip the home.

·         Upgrade costs can be delayed

After purchasing a home, you have the time to upgrade your home, allowing you to better budget for the expenses.

·         Easy to visualize

It’s easier to visualize your pre-existing floor plan.

Disadvantages of buying a house:

·         Upgrade costs:

Having the chance to move in your home is great but even the simplest home improvement, such as a kitchen, can be a major time and money investment. 

·         Higher home insurance:

There’s a possibility your home insurance will be higher compared to a new home.

·         Decorating cost:

Besides paying your closing cost, there are other upfront cost you should be worried about. You might have to invest some time to upgrade your home like wallpapers, changing paint colors, or updating floors.

When it comes to building or buying a home, it really depends on the buyer’s goals. I believe it comes down to personal preference. Once you are ready to house hunt, you will know exactly what you’re looking for. Owning a home is a great thing that can happen. What is the right choice, for you?

 

Additionally, if you want a full team of mortgage professionals, we’re happy to help you make the right decision. Please don’t hesitate to reach out to us for more details: 770-552-1000.

We look forward to hearing from you!  

3 Ways Parents Can Help Buy a House for their Kids

Increasing mortgage rates and housing prices may make it tough for your kids to own a home. However, families appear to be helping the younger buyers purchase a home. Before you lend a hand, here are three ways parents can help make it more affordable for first time buyers to purchase a home.

Gift the Down payment Money

When you give money to your child’s down payment, it classified as either a loan or a gift. With a gift, there’s no contract or ongoing commitments.

Your child’s mortgage lender will need proof showing that the money is a gift, not a loan. You will need a gift letter, where you state don’t plan on asking for the money return. Your child’s mortgage lender may also ask for a paper trail verifying where the money came from.

When it comes to taxes, it can be transferred tax-free up to a certain limit. You can give up to $15,000 without filing the gift-tax return.

Buy the house and rent it out to your child

If you can afford buying a second home, you have the option to rent out to your child. This might be a good option if your child can’t qualify for a mortgage. When buying a second home, there’s generally deductions available for property taxes, mortgage interest, repairs, maintenance, and structural improvements. So, what’s the catch? Your kids must pay you rent to be qualify for these tax deductions. So, make sure they aren’t living in the house for free.

Buy and co-own the house

This arrangement is a good opportunity, however, not all mortgage lenders offer homes loans for shared ownership. When shopping around, you would want to double check this financing option.
Co-borrowing helps borrowers overcome a limited credit history. But remember, you would want to keep in mind that the parent’s credit could be affected, making it harder to finance another big purchase later.

If you want a full team of Mortgage Professionals to help you with your decision on what is the best loan option for you, we’re happy to help! Please don’t hesitate to reach out to us at 770-552-1000. We look forward to hearing from you!

Millennials Know What They Want

There have been a lot of myths floating around about millennials not being interested in home purchases. Maybe you’ve heard that they still live with their parents due to student loan debt, don’t have a 20% down payment or they have no interest in settling down.

In reality, more Millennial homebuyers are taking advantage of purchasing a home rather than waiting to purchase a home based on big life events. Millennials are changing the real estate market because they aren’t waiting for marriage or starting a family to buy a home. In fact, Millennials have been watching their rent go up over time and at some point, they realize it might make sense for them to buy instead of signing another lease.

Buying a home is a serious decision that can be stressful. However, Millennials are now buying more homes than ever. They are buying homes on their own terms, within their own budgets. They aren’t afraid to purchase a home. They are willing to travel and relocate for a secure job, safe neighborhood, and their desired lifestyle.

They see the value in homeownership and preparing financially. The internet and smartphones have empowered millennials to do their own research. While most millennials are moving from a rental or out of the family home, they have the time to narrow down their search for a home that they could afford. Millennials aren’t waiting. They are actively seeking homeownership since they’re powering today’s housing market.

If you are one of the many Millennials who are ready to buy a home, we have a full team of Mortgage Professionals to help you decide on what is the best loan option for you! Please don’t hesitate to reach out to us at 770-552-1000. We look forward to hearing from you!