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Health & Fitness

How to Achieve Your Goal of Homeownership in the Coming Year - Don't let the down payment get you down

The start of a new year means letting go of the past and wiping the slate clean for hopes of a brighter future.  For many, thinking about the future often entails family, career and of course a home.  If your goal for the New Year is to start the path to homeownership, don’t get discouraged by the dollar signs. Although you may think saving up for a down payment is easier said than done, it can achieved in as little as a year’s time if the right steps are taken. 

 “The key to a smooth process for first time buyers is that they have a good sense of their financial situation before starting their search,” said Jim Dohr, president of Coldwell Banker Gundaker.  “It’s important that they find a trusted real estate agent that can help navigate the course to cost savings with such an important investment.”

The secret to saving up for homeownership is simply evaluation, prioritization and self-discipline.

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 Evaluate what you can realistically afford

Do the math and determine your appropriate price range based on the amount needed for a down payment. If you’re able to save 20 percent, lenders will not require you to purchase Private Mortgage Insurance, which will reduce your monthly expenses.  Although a 20 percent down payment is not mandatory, it is certainly more financially responsible.

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 Prioritize, prioritize, prioritize

A home is an investment that appreciates over time.  It’s important to keep that in mind so that short term benefits don’t overshadow the long term goal. Maybe this is the year to hold off on a big expensive vacation, over the top wedding or luxury vehicle in order to add more cash to the down payment fund.  Even altering small day to day activities can really add up over a year’s time.

 Have some self- discipline

If you can’t seem to help yourself when it comes to spending frivolously, there are options to enforce discipline. For one, open up a savings account solely dedicated for the down payment with an automatic transfer from each pay check.  Also, check with your bank for special auto-savings programs that offer an easy way for consumers to accumulate modest savings.

These three easy tasks can guide you towards your dream of becoming a first time home buyer.

 

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