Saving for a down payment will take years but with a sound strategy in place, you can speed up the process. Most homeowners want to put at least 20 percent down, which in Loudoun and Fairfax Counties is around $104,000—with the median price in 2019 being around $536,000. Here are some tips to get there faster.
No New Debt
While many prospective buyers will get to work paying down their debt it is important not to create new debt. Purchasing a vehicle is the exception to this rule but no more credit card debt from here on out.
Slash Your Expenses
If you can slash your current expenses by at least $500 a month it will generate $6,000 per year. This might sound impossible but is easier than you might think. Some of the top ways to save include:
- Bundle cable and internet, downgrade packages, or switch to online streaming instead of cable.
- Minimize your monthly entertainment budget including taking fewer or less expensive vacations.
- Eat out less including skipping your daily café coffee.
- Downsize your current home to save on rent.
Find Additional Ways To Generate Income
Every little bit adds up so look for additional ways to earn. Sell items you don’t use, rent out a room on Airbnb, and put every little bit of unexpected income into your down payment fund. Also, consider taking on a second job. The goal is not to spread yourself too thin so look for a way to make a little bit more here and there.
Set Up An Automatic Savings Plan
Once you decide how much you want to set aside each month for your down payment, schedule to have that amount automatically transferred to your savings account. This can be your general savings account, or secondary savings account dedicated to your down payment. This automatic transfer will help to minimize the temptation to spend more.
Work With A Financial Advisor
Working with a financial advisor is one of the fastest ways to accelerate your savings and maximize your money. Your financial advisor will help you create a reasonable timeframe to buy, instruct you on how to improve and maintain your credit to achieve an attractive interest rate, create a new budget, and find additional ways to save.
Your new budget and financial plan will require quite a few changes but will be worth it when you find your dream home!
Ready To Buy In Northern Virginia?
If you have your down payment set aside and are ready to buy a new home in Northern Virginia we invite you to reach out to the team at Jerry Sardone Realty today. We work with you as your guide with the goal of helping you find a home and investment you will be happy with for years to come.