Down Payment For Your First Home In Oakland County Michigan

Down Payment For Your First Home In Oakland County Michigan

So you’ve decided to purchase your first home in Oakland County, Michigan. Congratulations! Purchasing a home is a huge decision, and it can be one of the most exciting and rewarding experiences of your life, but getting the down payment can be tricky and challenging.

But purchasing a home requires capital, and if your savings account is looking a little trim, it means that you will have to do some budgeting in the upcoming year to make your dream of being a homeowner a reality and having that elusive down payment.

Here are 7 budgeting tips to help you buy your first home and save for your down payment.

1. Start Tracking Everything You Spend

You will not be able to make any major changes to your budget if you don’t have a firm understanding of how your money is being spent. Tracking everything you spend for a month will show you exactly how much you’re spending, where you’re spending it, how much of your budget is going towards necessities and how much of your budget is going towards luxuries items and what could possibly be going towards your down payment for a new home.

You can keep track of all of your expenses in a spreadsheet, but a better strategy is to use an app like spending tracker like Mint or Prosper Daily (formerly BillGuard). These apps link to all of your accounts and will track and categorize your spending, making it easy to visualize where your money is going.

2. Identify Areas To Cut Back On

Once you know where your money is going, it’s time to identify the areas where you can cut back and save additional funds to put towards your down payment. Every household will be different, but when you’re saving for a house, anything that’s not a necessity (like rent or medical insurance) should be considered an area where you can cut back and start saving for your down payment.

Things like eating out, daily Starbucks and an expensive gym membership are great, but they can quickly eat into your budget. Cutting back on extra spending is a great way to build your savings and get you into your new home faster.

3. Create A Budget Which Includes Money For Your Down Payment

Creating a budget – and sticking to it – is one of the best things you can do for your finances as you’re gearing up to buy your first home and down payment. There’s nothing more frustrating than having a savings goal and consistently falling short each month because of thoughtless spending. Having a firm budget (and holding everyone in your household accountable to it) helps you stay on track towards your savings goal.

Create a budget that includes all of your set expenses (like rent), the amount of money you will put into your savings account each month and allowances for categories like food, entertainment and gas. Then, stick to the budget no matter what.

Having a set amount for how much you can spend on things will make you think twice before pulling out your wallet.

4. Get Your Credit Score Up

One of the most important factors in the home buying process is your credit score. Your credit score (and the credit score of your spouse, partner or co-buyer) will directly affect the interest rates on your mortgage, and a good credit score can save you thousands of dollars a month and assist in a lower down payment for your first home in Oakland County Michigan.

If you can, work to bring up your credit score as much as possible before you apply for your mortgage. Pay down any outstanding credit card debt, check your credit report for inconsistencies and always pay your bills on time.

5. Practice Paying Your Mortgage

When you create your budget, you should have an idea of how much you can afford to spend on your mortgage payment when you buy a home in Oakland County Michigan. But you shouldn’t wait to buy a home to start making that payment, particularly if it’s higher than what you’re currently paying in rent.

Practicing your mortgage payment will give you real life experience of what it will be like to make that payment each month. Take the difference between your current rent payment and your projected mortgage payment and immediately put it into savings at the beginning of the month.

You might find that you overshot how much you can afford and your projected mortgage payment puts you under too much financial strain. Or you might find that you actually have more wiggle room in your budget than you anticipated and can afford a higher mortgage. Either way, that’s information you want to know before you lock in a 15 or 30 year payment.

6. Pay With Cash

It’s easy to lose track of how much money you’re spending when you put everything on a debit or credit card. With just a quick swipe, you have everything you need. But paying for things in cash can make the purchase feel more real and can help you get a better handle on your spending.

At the beginning of the week, take out all of your spending money in cash. Then, make a commitment to only use the cash in your wallet to cover your expenses. If you run out of cash, that’s it.

Seeing your cash dwindle as the week goes on will help you visualize how much money you have left for the week and can help curb needless spending to allow for down payment saving.

7. Reward Yourself Regulatory

There’s no way around it – saving money for a down payment is tough. It’s important that you reward yourself for your successes and for moving towards your savings goals.

Set milestones for your savings goals (like saving $1000 or paying off an outstanding credit card balance), and treat yourself when you hit that goal. The reward will give incentive to keep going when things get challenging.

One trap you’ll want to avoid is rewarding yourself with something large, extravagant and expensive. Rewarding yourself for saving money by spending money isn’t a recipe for success! Your reward should be something low cost (or free) that still feels like an indulgence, like a picnic day at the park with your family.

With these tips, you’ll be well on your way to signing those closing papers, getting your keys and making a new life in your first Oakland County Michigan home.

I’m here to help you find the perfect Oakland County, Michigan home, once your ready and have your down payment saved. Give me a call 248-790-5594 or email me @ [email protected]

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Crowdfunding For Home Purchases – A Futuristic Reality

Crowdfunding For Home Purchases – A Futuristic Reality

When looking to purchase a home in Oakland County, Michigan for the first time can be a difficult proposition and for for many potential buyers, one of the biggest obstacles on the road to homeownership is saving for a down payment. But thanks to a new technology trend, some savvy buyers are turning to their friends, family, and social networks for help in their home purchase these days, and it seems to be a trend that is spreading across the country. It is clear that technology and social networking can be a great way to stay tuned socially and in business, but now it has gone to a whole new level with CrowdFunding to help wanna be homebuyers reach their down payment goals by reaching out socially for assistance.

The CrowdFunding Trends

While crowdfunding has long been a popular trend, until recently it’s been mostly limited to the business world, but this is now changing to the private sector as well. According to a recent article in The Wall Street Journal, crwdfunding for home purchases is on the rise. There’s even a crowdfunding platform specifically for homeowners. HomeFundMe is the first  platform specifically targeted to potential homeowners looking to fund a down payment. Potential homeowners are given 12 months to reach their down payment goal, and all funds are wired from an escrow account to the seller when buyers make their property purchase.
HomeFundMe is still new (the platform launched in October 2017), but results so far are promising; according to the WSJ article, approximately 400 potential homebuyers have used the service to help crowdfund their home purchase down payments since the launch.

The Takeaway

If you’ve been thinking about buying a home but haven’t been able to save for a down payment, crowdfunding could be a way to make your dreams of owning a home a reality.

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The Know-It-All Guide for When Entering the Sellers Market

The Know-It-All Guide for When Entering the Sellers Market

Buying a home for sale in Novi, Michigan is no walk in the park. It is not entirely a seller’s market. The sellers market keeps popping one out and if you are right on time, with the right offer, you might get lucky. This is why it is important to let a realtor handle this job because not only do they have up-to-date knowledge about the real estate market but they have some savvy skills to tip the offer in your favor.

When entering the bidding war, remember one thing: sellers are fickle. When they see a better offer coming their way, they abandon the buyer they are dealing with. This is why you need to be on your A-game when purchasing a house.

Understanding the Sellers Market

When the demand for the house is higher than what is available in the market, it means you are dealing in a sellers market. This type of market strives on one thing and one thing alone: competition. To prevent your offer from drowning in this competition, follow these five tips to get your offer at the forefront:

1. Have the Mortgage Pre-Approval Letter Ready

The mortgage pre-approval letter shows the seller that you are a serious buyer. The moment the final asking price is settled, get in touch with your lender and get the mortgage ball rolling. Show the seller the mortgage papers, so that he doesn’t pursue other buyers.

2. Hire a Realtor

As mentioned earlier, the realtor will make sure that the offer you are receiving is in your benefit. In case you feel that certain clauses mentioned in the contract don’t look good, the realtor will be at the negotiations table again, to make sure that you are happy.

3. Learn to Compromise in a Seller’s Market

There’s a high possibility that you might not find some of the amenities you were looking for in your home for sale in Novi, Michigan. This doesn’t mean that you should walk away from a good offer. Remember, never go for houses that are listed at a high price because the seller might not lower the price and then you will be left disappointed.

4. Higher the Down Payment, Higher the Chance of You Getting the House

20% is the ideal down payment that every buyer loves. This will give you an edge in the competition and the seller will be more inclined towards selling you the house.

5. Speed Up the Home Inspection Process

When you have put down the earnest deposit, you cannot back out of the deal or you will lose this money… unless the seller lied about something on the home inspection report. You are given a time period of 2 weeks, where you need to conduct all your investigations about the house. Get the home inspection done in the first week and spend the second week in calculating repairs to see whether the house is worth it or not. Will the house bring your profit when you will sell it in the future? These two weeks are crucial because after they have passed, you won’t get your money back even if you back out of the deal thinking you don’t like the house.

Ready to dive into the seller’s market with your realtor? Follow these five tips and you will find your home for sale in Novi, Michigan in no time. If you want to buy a house that falls under your budget and has all the features you need, then visit Homes2MoveYou. Get in touch with a real estate agent and start seeing houses in areas of your liking.

 

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The Top Sacrifices Millennial Buyers Say They’ll Make

The Top Sacrifices Millennial Buyers Say They’ll Make

Buying a house is a major financial transaction and, for most Americans, the largest one they’ll ever undertake especially the millennial population. So pulling the necessary resources together to be able to afford the upfront costs, in addition to the ongoing obligations, maintenance, and upkeep can be difficult. Especially for first-time home buyers who don’t have the benefit of being able to sell a home to help fund their down payment.

For this reason, many millennial buyers who aspire to homeownership have decided it’s worth making a few sacrifices in order to help save money to buy a house. In fact, according to a recent survey from ValueInsured, there are some common sacrifices young Americans say they are willing to make in order to buy their first home. For example, nearly 60 percent of respondents said they would cut down or give up eating out – which made giving up restaurants the most popular sacrifice among survey participants. Other common sacrifices included taking a second job, not going on vacations, moving back in with their parents, and giving up shopping for clothes. More here.

Millennial Home Buying Roadblocks

Millennials, which is the generation comprised of people born from 1980 to 1998, are buying homes at a much lower rate than previous generations in favor of renting or moving back in with their parents after college. And a large reason they’re not buying?

Because they believe they can’t afford it. According to data from Apartment List, 72% of millennials say they can’t afford to buy a home.

 

One of the major roadblocks millennials believe stands in their way to homeownership is the down payment. But many millennials are operating with incomplete or incorrect information about how to purchase a home. According to a Fannie Mae survey, 73% of millennials surveyed were unaware of lower down payment options (like the ability to pay 3% to 5% of the home’s purchase price instead of the traditional 20%).

 

These lower down payment options are increasingly common in today’s market. According to a recent NerdWallet report, 30% of all homebuyers put down 3% or less when purchasing a home.

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