It’s 2019 and your dream of owning your home is nearing but do you have enough savings?
Saving for your down payment can sometimes be a daunting task. Firstly, you should look at your monthly expenses and the mortgage amount you can afford.
According to Investopedia, it is recommended that your mortgage or rent payments shouldn’t be more than 36{be0915f7735028944939e74bc928fad817694f7c1305c2cf7207b1919b42c4be} of your disposable income. Use this as a guide for your monthly mortgage payments. Once you’ve figured out what monthly mortgage payments you can afford that will give you a ballpark figure of the home you can afford.
When you know the price of the home you can afford, you can determine how much down payment you need. However, keep in mind that the grants you qualify for may reduce the amount of down payment you need.
To get ahead of the game find out which grants you qualify for and use this to determine what down payment you’ll need. Knowing this information can help you to save the amount necessary for your down payment and a little bit more. It’s always good to have extra cash when you’re purchasing a home for any emergencies or unforeseen expenses.
You have to be disciplined in saving and this will mean cutting back on things that are ‘wants’ and not ‘needs’. To see how much money you can save a month towards your down payment make a list of your expenses (the expense and the amount that you spend on a monthly basis).
After you’ve written down your expenses and know what your discretionary income is, you’ll know how much you can save for your downpayment. Now stick to it and in no time you’ll have the down payment for your home!
Happy Saving!
