Although living happily in a particular home requires much more than just financial considerations, the reality is often that unless/until you can have the economic/financial needs, including a down payment and the money needed. for closing costs/expenses, you will not be able to address these other requirements/needs! After more than a decade as a licensed real estate seller in New York State, I have come to firmly believe that the more educated and prepared a qualified prospective homebuyer is, the better their decision-making ability. , and often your happiness, with the process in general! One of these elements, which requires attention and preparation, is having the necessary funds for the necessary down payment and other related closing costs. With that in mind, this article will briefly attempt to consider, examine, review, and discuss 5 potential funding sources.
1. Friends and family: Perhaps one of the largest single sources for this funding is your friends and family! You probably know many homeowners who got much of the funding they needed from one or a combination of these sources! These are, in general, the people who care the most about us and our needs, so if they can. They are often willing to help, as much as possible, your personal circumstance permitting!
two. 401(K); unions; etc: Unlike IRAs, there are no tax penalties when we borrow funds from our 401(K) plans for the purpose of making a down payment on a home. Many unions also offer plans for their members to help with these kinds of eventualities. Some employers have specific programs designed to help, inspire and motivate employees to remain loyal to their company. The key is to think outside the box!
3. Personal savings: Unfortunately, long-term financial planning is rarely used! With the power of compounding and the concept of Periodic Payment – Investment, those who have the discipline, focus and commitment, as well as the ability, to periodically set aside specific funds, for this purpose, have accumulated the amount of personal savings, which could make this down payment available.
Four. Sell financial assets: Some use other financial assets, such as stocks, bonds and others, to accumulate the necessary funds, in a prepared way!
5. Different percentage of advances, necessary: Although many believe that you have to have 20%, to put it, the reality is that there are many circumstances in which a smaller amount is needed. In fact, on average, the down payment is around 13%. However, one must realize that a lower down payment will result in a higher monthly payment. This can cause other challenges, in terms of qualifying for a mortgage, as well as monthly financial stresses!
The bottom line is, get ready! The more you know about your options, the better you can evaluate them and do what’s best for you!
