Author: Ryann Cairns
You can Visit The Author's Website: www.sosdebt.org
The first step you will need to undertake when beginning to save for a mortgage down payment is to calculate approximately how much money you will need. Most down payments are calculated on a percentage basis of the total loan. Don't make the mistake of assuming you can get a mortgage loan for zero down. These types of mortgages are advertised frequently and you may be able to qualify and you may not.
The safest course of action is to assume you won't and work on saving for an average down payment. This means you need to decide how much you can afford to spend on a house and go from them there. Mortgage loans vary, but many can be had for 95-97% financing. This means you will need to come up with the remaining 3-5%. That may not sound like a lot, but keep in mind that the more expensive the house you select, the larger your down payment will be required.
Additionally, keep in mind when you are able to put more money down on a house, you will be able to reduce your mortgage payments and pay off the home sooner. Another benefit is that larger down payments often persuade lenders to overlook problems like splotchy credit records.
Once you have determined how much total money you will need for a down payment on a home, decide how long you are willing to wait before purchasing a house. This will help determine how much money you need to free up from your budget every month. Divide the total down payment by the number of months you are willing to wait. 12, 24, 36, whatever. Unless you are fortunate enough to receive a large cash sum by way of inheritance or some other unlikely manner, freeing money from your monthly budget is going to be your best bet at saving towards a mortgage down payment.
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