Best Ways to Build a Down Payment

 

One of the biggest hurdles for many prospective home buyers is finding a way to accumulate enough money for a down payment. Here are some suggestions on ways to raise the funds you’ll need.

 

• Start by minimizing nonessential expenditures.
  • Get in the habit of paying with cash and not buying things
    you can’t pay for immediately.
• Talk to your parents or relatives.
  • They may be willing to make a private loan to you, or they may be willing
    to co-sign on a mortgage.
• If you have a “whole life” life insurance policy, you can look into borrowing against its cash value.
• If you own other real estate, you could borrow against your equity.
• If you’re a first-time homebuyer, you may be able to withdraw money from your IRA or retirement fund
  penalty-free.
• Consider selling personal items such as a second car or boat.
• Explore FHA and VA loan programs.
  • Many of these programs require low or no down payments.
• Consider having an amount withheld from your paycheck and directly deposited into a savings account.
• Pay down high-interest credit cards and limit your credit card use.

With some discipline and creative strategies, you will be well on your way to saving enough for a down payment.