9 Ways To Start Saving For Your First Home
Happy Tuesday! If you haven’t been keeping up with my ~personal~ life or are new to this corner of the internet, my hottie of a husband got a new job a few months ago that set our plan to buy a house by the end of the this year in motion. We have been saving and planning to be homeowners for a while now, and 2018 is totally going to be our year! Buying a house isn’t an easy task as we are discovering, and it requires detailed ideas, action plans and goal setting. Adam & I sat down to create this list to help you get started on saving for YOUR first home, too. It’s NEVER too early to get prepped for home ownership and we’ve got some awesome resources for ya. Let’s dive into this.
9 Ways To Start Saving For Your First Home
This post is sponsored by Allstate. All opinions are my own.
This is the dream home on our vision board (or something super similar)!
Get pre approved for your loan.
This is a good first step when it comes to thinking about buying a home. It doesn’t make any sense to look for a house without knowing what kind of home you can potentially afford. My biggest fear is falling completely in love with a home and then not being able to afford it! I don’t even want to LOOK at a house that we couldn’t get a loan approved for.
Decide on your downpayment and ideal home price.
It’s important to be on the same page when it comes to your home price and deciding on a downpayment. Even thought you may be approved for a $300,000 loan, you might not want to buy a home all the way at the very top of your loan price. My husband and I decided we’d rather go lower than the top of our loan price so we can live comfortably in our means and not stretch our budget completely to the limit. We have decided what we want to have saved by November and what our ideal home price is together.
Know and understand your credit score (+ how you can begin to improve it, if need be).
Adam & I have great credit scores, but we are always look for ways to improve it! Find out what your credit score is before you go to have a loan pre approved so that you can work on improving it before hand, if possible. There are always ways to start building that score and improving your chances of qualifying for a better loan.
Make a list of financing options you can utilize.
Check out this resource here to find out the different types of financing options you potentially qualify for! Depending on the length of time you plan on living in the home, your past credit score and you lenient your bank is all go into determining what kind of financing options you can use when applying for a home loan.
Start budgeting for monthly mortgage payments BEFORE you buy.
I think this is one of the BEST things you can do. When you find out how much of a house you can afford, you can determine your potential mortgage payment. You should start budgeting for THAT payment now! The extra money you have a month from budgeting that out can go into your downpayment/unexpected costs account – you kill two birds with one stone.
Get multiple mortgage quotes.
This one is important, too (I mean – it’s all important, amiright?). Be sure you are shopping around for the BEST mortgage quotes. A big mistake you can make when buying your first home is to just accept the very first quote that comes your way. Check several sources when it comes to this step – banks, mortgage lenders, brokers, etc. You’ll find that even 1% difference can save you thousands of dollars!
Practice your negotiation skills.
There are lots of things you can negotiate when it comes to buying your first home. You can obviously negotiate purchase price, everyone assumes that. However – did you know you can also negotiate closing costs and inspection fees as well? If the seller REALLY wants to get out of their house, they will often be flexible on these costs. You can potentially get the seller to pay all of those fees and sometimes more. Polish up your negotiating skills to get the very best deal you can!
Put aside money for closing costs, inspection costs and furnishing your new place.
If you cannot manage to negotiate your way into no closing costs or inspection fees, you’ll need to make sure you’ve got money for this set aside. Closing on your home usually sits between 2-5% of your purchase price, for reference, and inspection fees can cost a few hundred dollars. In addition to those fees – you’ll have to make sure you can furnish your whole home if you are upsizing significantly. Adam and I will be going from a one bedroom apartment into a house, so we definitely are saving to make sure we can furnish our house!
Start an account for “unexpected” costs of owning your own home – like broken hot water heaters, lawn maintenance, gutter damage, etc.
SO MANY EXTRA COSTS come into owning your own home. In our apartment, all of that is covered by the maintenance department in our complex. Once we own our own house, however, all of those extra costs are up to us. We are trying to save as much as possible now so that if something unexpected DOES come up, we are fully prepared to handle it.
PIN THIS FOR LATER:
We are so excited to buy our first home this year. It’s the next big step in our marriage and we have been waiting for it since the day we got married! Neither of us LOVE living in an apartment and once we have a house with a yard – we are getting a PUPPY (that’s the real push here).
Have you bought a home recently? What tips do you have for us? Let me know in the comments below!