How to Save For a Down Payment as a Livermore Valley Homebuyer

money in handWith mortgage rates rising, it’s safe to say that if you want to buy a Livermore Valley home, your best bet is to act soon and have a down payment saved up. The most affordable mortgage rates available require at least 20 percent down.

If you don’t have that much saved, but you still want to buy soon, I’ve got some suggestions to share! As your Livermore Valley real estate agent, I want to help lead you down the path to homeownership in Livermore Valley, and to help make homeownership as affordable as possible for you.

Daily Finance recently shared tips on how to save $20,000 in just two years. You should aim for saving $833 a month for the next 24 months. Here are some tips for doing so:

  • Make big changes first. If saving $833 per month is out of the question for you, decide what big change you could make to help this happen. Move in with family and save your rent money. Move to a smaller apartment. Get a roommate. Consider getting a second job for nights or weekends, or consider selling your car.
  • Take small but steady steps. Create a household budget to see exactly where your money is going. If you shop a lot, reduce your new clothes, shoes and the like. If you eat out a lot, start brewing your own coffee and cooking at home. Cancel cable or the internet for the time being. Ride your bike to work or to run errands. Start paying in cash. Ask yourself, “Do I need this or do I want this?”
  • Scale down your 401(k). The article suggests doing this only if you’re contributing more than what your company will match. You can scale back for a couple years, then return to putting that much in after you’ve saved your down payment. You could also boost your IRA contributions, because you can use up to $10,000 toward a down payment on a house.
  • Save your cash in a separate account. This way you can easily view your progress. Financial experts in the article recommend a high-yield savings account or a CD. Credit unions or online banks usually offer better interest rates than traditional banks. They suggest steering clear of investing this money, because there is always the risk of losing it.

When you’ve got 20 percent saved for a down payment and are ready to buy a Livermore Valley home, contact me, your Livermore Valley real estate agent! If you don’t have 20 percent saved but want to buy now, there are alternative loan options for you. If you’ve got questions about all this, contact a local mortgage lender. Feel free to also contact me! I’m happy to answer questions and help steer you in the right direction.

John Kurtzer
Your Livermore Real Estate Expert
RE/MAX Accord

Livermore Real Estate
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