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How to Save for a Down Payment for a New Home

Posted by : Premraj | Posted on : Monday, July 31, 2017

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Saving to buy a house doesn’t mean accumulating enough money to pay in full outright. You can get a mortgage loan when you’re buying real estate and homes for sale in Laval, and this is much easier if you can make at least a 20% down payment on the price of the house you’re buying. This saves you from the expenses of private mortgage insurance when you borrow more than 80% of the value of the house.

If you think that in the near future you’re going to buy a home, then the best ways to make that happen is to start saving your money now. It will take a while and it will require discipline, but you can do this with some effort and determination.

Here are some ways you can start.

Have a budget. You first need to track down how much money you have and how much you spend on various items. This will help identify expenses, which you can reduce or cut down completely. If you’re a smoker, for example, then it may help you to quit smoking when you realize how much that filthy habit is really costing you.

Pay off your credit card debts. This is necessary because if you have too much credit card debt, you won’t qualify for a montage and therefore you can’t buy the house you want. While this task may seem almost impossible, it can be done.

Start with the debt for which you pay the smallest minimum payment. Pay that off completely, but use that minimum payment you used to make to help pay for the next smallest debt. When that’s done, you now have 2 minimum payments that can help with the 3rd smallest debt, and so on. The amounts you’re able to pay snowballs as you pay off more debts completely.

Save your extra money. Try to live off your basic salary right now and make ends meet. If you get a bonus, a tax refund, or an extra commission, don’t use that extra money to splurge. Instead, put the money into a savings account that you’re reserving for your 20% down payment.

The same goes if you get a raise. The extra money you get each month should go into your savings account too.

Don’t go out to eat. Do you eat out a lot? If you eat out twice a week, reduce that to once a week. You can also start looking for cheaper restaurants that you still like. You may also want to patronize restaurants that constantly offer discounts or have coupons.

Stop watching movies in theaters. Do you often go to movie theaters? Try just watching movies and TV shows on cable instead. Or you can go online and download movies for free.

Minimize your new book purchases. How many print books do you buy? If it’s a lot, perhaps you can stick to secondhand books, or maybe even just go to a library. You can also go online and download digital books for a discount or even for free.

Stay at home for vacation. How many vacations do you take? You may want to limit the number, and you can perhaps stick closer to home. You may even want to explore the concept of the “staycation”.

You can eventually end up with your 20% down payment for homes for sale in Laval just by living modestly. Don’t live large, and your savings account will be the one that’s getting bigger in the end.

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