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How Much Will You Need to Save for Your New Home?

8/25/2017

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Buying a home is one of the largest investments any person will ever make. While some people choose to buy a home and finance it in its entirety, others save up enough cash for a down payment and closing costs.

The amount of money a person is able to save often has an impact on the loan they are offered. If you are planning on buying a home in the future, here is what you need to know about the funds needed to do so.

In the Short Term

When you are attempting to qualify for a loan, lenders will take a close look at your pretax income. You can do the same. Look at your gross income and try to stash away about 20 percent of that in one year. For example, if you make $50,000 a year, make a goal to save $10,000 by the end of 12 months. This is the minimum. If you can save more, it will benefit you when shopping for a mortgage loan.

In the Long Term

If you plan on buying a home in the future but are looking beyond a year's time, try to put away about 10 percent of your income each year into a home savings fund. Using the same numbers, if you make $50,000 a year, that would be $5,000 put into savings by the end of 12 months.

Down Payment Requirements

Different loans have different down payment requirements. Knowing these can help you determine what you will actually need to purchase a home. If you go with conventional financing, you will need a minimum down payment of 5 percent. FHA requires a down payment of 3.5 percent, and Home Path Financing will ask for 3 percent down. Of course, these figures may fluctuate based on the market and your own credit history.

The money you should save will be dependent upon the type of house you are planning on buying. If you are interested in homes for sale in Griffin, an experienced real estate agent in our office can assist you in determining how much you will need to save and the best loan product for you. Call our team today.

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    The Dottie & Kate Team are real estate experts in Stockbridge, Georgia who enjoys writing about home staging, Lake Jackson, and tips for selling your home quickly!

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  • Home
  • Find a home
  • Featured Properties
    • 225 Late Rise Rd Monticello Ga
    • 120 Friddell Rd
    • 1600 A Hwy 81
    • 1809 Stark Rd
    • 13759 Woolsey Rd
    • 225 Tussahaw Ln
    • 469 Parker Rd
    • 267 McDonough Rd
    • 1600 B Hwy 81
    • 115 June Court
    • 332 Roberts Point Road
    • 7625 Wright Circle
    • 695 Moreland Road
    • 2551 Hidden Hills Drive
    • 110 Walnut Ridge Way
    • 108 Greenland Drive
    • 29 Highland Circle
    • 521 Blue Cedar Court
    • 779 Crumbley Road
    • 2933 Old Snapping Shoals
    • 171 W Nuthatch Drive
    • 118 Bell Road
  • Home Staging
  • RESOURCES
    • Blog
    • Selling Tips
    • Locations
    • FAQ
    • Real Estate Glossary
  • Contact
  • 1809 Stark Rd