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Save to buy a house.
A house is typically the single most expensive item most people will ever buy and the longest it will ever take to pay for something. Given the mortgage lending crises of the recent years (and those echoed in the 1970s), it's important to avoid the mistakes of others and do it right. One way you can ensure your buying experience is safe and secure is to save at least 20% for a down payment.
Save up a big down payment and reap the rewards later!
Know where you can cut back
Buying a home is going to cost a significant amount of up-front money, and any lender who tells you differently is taking you to the cleaners. Whether you are married or single, having a sizable down payment means that your loan works better for you from the get-go. A significant down payment means you can negotiate better lending terms, a reduced interest rate, and fewer tacked-on fees.
Using BudgetPulse means you know what you spend today, and what you'll likely spend next month, and the next, and so on. By analyzing what you are spending, you can quickly identify areas of over spending and work to cut those back. Do you pay for a gym membership you never use? Get rid of it, and take fast walks instead. Put that monthly fee into a high-yield savings account and you've just started saving your down payment on a house.
Paying off debt makes it easier
By using BudgetPulse to track and pay down your debts, you'll have a better chance at clearing useless debt so you are prepared to make a mortgage payment regularly. You'll also have shown you have the discipline it takes to be eligible for a mortgage and the commitment to saving for the big things you want instead of going into debt and paying for them over time.
Paying off your debts prior to buying a house also means you can negotiate the best mortgage interest rates, avoid costly and unnecessary purchasing fees, and even be in the position to buy points to further reduce your interest rate.
Once again, buy realistically
After you've carefully reviewed your budget, you can start to get a picture of how much you can afford in a mortgage. A mortgage payment typically consists of the principle, the interest, the taxes, and the insurance all rolled into one monthly payment, so it's important to factor all those items in as you decide how much you can safely afford. After that, you can think about how much house you can buy. While many mortgage lenders will work with you and honestly disclose the total monthly payment, it's important to know these facts and protect yourself from those who may not be dealing quite as honestly as others.
Houses, like cars, are not one-time costs. Houses take maintenance and now that you are no longer renting, fixing the water heater or roof is up to you, not the landlord. It's important to remember that the overall cost of owning a home is not simply the monthly payment. You must factor in unexpected costs that will occur as appliances and features of the home degrade over time. With BudgetPulse, however, you are in a better position to make wise choices as you finally know exactly what you are spending and where and what you can afford in unexpected expenses.
