Now that you’ve created a down payment budget, it is time to figure out how you are going to save that large amount of money. Saving up a larger amount of money may seem impossible with your current financial situation. The best way to create this plan is to have a budget. If you are aware of the money you have coming in and going out, you can find a way to set aside money for your down payment each month.
First you should access how much money you already have set aside that can go toward your downpayment. Have you already started saving toward a downpayment? Do you have a stock that you want to cash out toward your downpayment. Has a family member mentioned that they wanted to provide a gift toward your downpayment? Are you planning on using the net profit from your current home as down payment on your new home?
After calculating how much money you already have you need to determine the timeframe in which you want to save the rest of your downpayment. Saving $25,000 may be highly unlikely in a matter of 6 months, but much more attainable over a year. Once you’ve determined how long you’d like to take to save for your downpayment break that down into monthly amounts.
Once you have the monthly number of what you need to save you now need to look at your monthly budget and see if it is realistic. You may need to save $1500 each month toward a downpayment but only have $800 to spare. Now is the time to access what you are willing to sacrifice, perhaps you can cut back on your current budget, or perhaps you’ll need to save for a longer period of time.
Having a well planned budget for your downpayment will keep you on track to reaching your goal of buying a home. Be sure to right down on paper how much you want to save to hold yourself accountable. After a short term period of making sacrifices to save your downpayment you will find yourself searching for your very own home.