5 Secret Sources of Down Payment Money
With the rising cost of living and housing at a high, it can be difficult to save up for a substantial amount for a down payment. The sooner you start saving though, the sooner you can stop renting and finally own a home. Many hopeful buyers do not realize that they are closer to home ownership than they think. Here are some overlooked sources of money you can put towards your down payment:
Go through your monthly expenses and isolate the top ten highest costs. See if all of these items are necessary. A $100 monthly cable bill is not worth postponing your homeownership dreams, especially when there are several streaming services available for a fraction of that price. You should then, look at the items you buy most often. Something as small as buying lunch every day at work can add up to thousands each year. Redirect those costs to your down payment savings account can help you reach your goal much faster.
Sell Your Stuff
When you need to make more money, you can either spend less or make more. Selling things you don’t use much anymore can be a relatively simple way to earn more for your down payment. Some things to sell that you can make bank from are:
● Clothes, shoes, handbags
● Hobby-gear like bikes, snowboards
Don’t underestimate how much money you can make from things you already own.
As well as your items, you can try to earn more money by selling your skills. Spend your time off from your main job doing freelance work or turning your hobby into a mini-business. Efficiently using your time can bring in additional funds that can add quite a bit to your down payment fund. You can spread the word by letting your inner circle know about what services you will be offering on the side and spread the word online as well. Join freelancer websites and buying and selling networks to advertise your skills or products.
Family and Friends
Most mortgage programs allow you to use gift money from friends or family for a portion of your down payment. Have an in-depth conversation with people who have expressed interest in giving you money for your down payment. That way you know exactly how much more you need to save. Your lender may require a letter stating that the money was given to you as a gift and not a loan you need to pay back.
Consider looking into taking out money from your retirement fund or any other assets you have to contribute to your down payment. If borrowing from these funds helps you raise enough money for a down payment that reduces your interest rate enough that you can put those savings back into those funds, then it might make sense to borrow from yourself.
If you need help getting enough money together for a down payment, contact the team at Collin Bruce. We can help you build a strategy that gets you to your home ownership goals faster while also being practical. Call us today to find out more.