If you want to buy a home for your family but you are worried about the cost, then you need to take a hard look at your finances and find ways to improve your cash flow. By making a few simple changes in your daily habits, you can supercharge your efforts and position yourself to buy the home that you have always dreamed about. This article is about Money Makeover: How to Save for a Down Payment. Here are a few things to consider:
Assess Monthly Bills and Financial Accounts
Track your spending and pay attention to where the money is going. Many people find that they are overspending in certain categories, and awareness of their spending habits can help them reel in the costs. As an example, if you spend $5 per day on a cup of coffee in the morning, it works out to be $35 per week and adds up to $1,825 per year! By changing your morning coffee habit, you could use that money to save up for a down payment on a home.
Pay attention to your cable and internet rates. These bills can be changed, and it is often as simple as making a phone call to the company. By shaving down utility expenses every month, the savings can really add up over the year.
Also, consider the interest rates and service details of the bank accounts and credit cards that you have. By switching accounts or using a different type of credit card, you could cut fees and even start earning rewards or cash back with your regular spending.
Pay Off Debt
When you apply for a mortgage, they will check your credit report and consider your debt to income ratio. Since you know that the lenders will be looking at the credit score and debt balances, you can start right now to improve your financial statistics.
High amounts of consumer debt can have a negative impact on your credit score, so work to control your spending and pay down those credit cards. At the same time, it is also important to ensure that you have a history of reliable payments, so if you haven’t built a credit history yet then you should start with something small. Without a history of using credit cards and other types of installment payments, lenders won’t know if you will be reliable to pay on a mortgage. So, it is essential to build a good track record to show that you are a trusted borrower.
Additionally, paying down debt is beneficial to free up monthly cash flow. When those other balances are paid off, you will have the money that is needed to pay for mortgage and utility costs in your new home.
When you are ready to move and you want to find the home of your dreams, contact Duffy Realty of Atlanta! Our expert team is here to help with your home purchase in Atlanta. Call us today: (678) 318-1700. We hope that you enjoyed our article on Money Makeover: How to Save for a Down Payment.