Everyone’s dream is having his own house. But few people can afford to buy a new house. If you start saving your money in time, you can also buy a new house. Buying a new house is one the largest purchase, you will be ever going to purchase. Novice people sometimes, underestimate the amount of money they will require to buy a new house.
When you think about buying a new house, the first payment you will need is down payment. For example: You see a home worth about $250,000. For this home, you will need around $22,000 as a down payment. The down payment is usually 3.5%-4% of the purchase price. You can apply for loans as FHA Loan is offering loan for the lower – income earner. But the fact is, it is harder to get that loan. It is like that you will get a mortgage that needs 10%, 15% or 20% down. They also require closing cost 2%-6% of the house’s value.
Above the expenses I have mentioned, shows clearly you will require a huge amount to buy a new house or even its tough to get a loan. If you do not have such a huge amount, the answer is you will have to save money in order to buy a new house. Now how to start saving for a house?
Here are some tips and suggestions for you, that will tell you how to save money for a new house.
Save Your Bonanza
Whenever you get any bonus at work, any event package, a tax refund, lottery amount or any other unexpected money, does not spend that money. Make another account with the name of house- buying. Put all the cash in that account.
Try to Save Your Rent
If you are living in an apartment which is a bit expensive. The rent is $300, you are using a huge amount as rent. You can save half of the rent amount by sharing your apartment with a roommate. Or you can change your apartment and get a new one at a cheaper place to cut down the rent’s amount. You can save up to $100-$150. Put the amount in your house-buying account. So, that you cannot spend it.
Cut Down the Expenses Spend on the Luxuries
It is highly possible that you are spending too much on clothes, jewelry, outing, events, gifts and furnishing. You have to cut down your luxuries in order to save money. It is not compulsory that the expensive clothes or jewelry are your luxuries, but little things also count in your luxuries. Less outing can also save you a lot of money. If you are in the habit of going to drink coffee every week, giving up that habit can save you a lot of money.
Trim some side Expenses
Everyone has some side expenses, which we are ignoring or not counting as an expense. You can cut down these side expenses. Like you can go parks for running and jogging instead of buying a treadmill. You can cut the cord on TV cable and buy a mobile phone. You can cut down on the confectionery and the luxurious food items. Save that small amounts and it will give you a huge benefit in buying a new house.
Work More to Male More Money
You can do some extra work in order to save money for a house. Do not depend only on the saving. You can do any other part time job and save that money. Your family members can support you at work. You any other member can work and save money. You can work at your own office for some extra hours. You can do any online job for making some extra money. You can teach or use your skill for earning some extra money. But save that amount in the house buying account. Do not use that amount.
Many people only think, they do not do. But you have to implement these ideas if you really want to buy a new house.