How To Save For a House In One Year
Saving for a house can be very intimidating for most future homeowners. The average price of a home in Ameris Bank’s geographic region ranges from $290,000 - $461,000. Likely, that’s more money than you’ve ever spent in your life on anything. So where can a first-time home buyer begin? Ameris Bank has prepared these tips for learning how much you can afford and how to save for your home in one year. With some smart planning, help from experts and close monitoring of your spending habits, the first home of your dreams may not be as out of reach as you think.
To begin your home buying journey, you need to learn your range of affordability. There's nothing worse than searching for your dream home and realizing that you ended up looking at homes you can't afford. One important point to keep in mind is that just because a mortgage lender says that you can take out a mortgage for a certain amount, doesn’t always mean that you should. To avoid this common mistake, Ameris Bank offers various tools to ensure you know how much house you can afford ahead of time.
For a quick way to plug in numbers, run current home loan rates, against a home loan affordability calculator. To ensure you meet your financial goals, you will first need to establish a down payment budget. Keep in mind your timeline for this budget. If you want to save for your first house in 12 months, you must represent that in your spreadsheet. It’s also important to consider the length of the mortgage loan and how comfortable you feel paying it off. Consider the 12/25 rule of thumb: a 15-year fixed-rate mortgage should make up no more than 25% of your monthly income.
For assistance with sticking to your budget and ensuring it is realistic, contact a local financial advisor. They can provide you with helpful tips on how to improve your chances of being able to save for your first home. He or she can recommend where to cut spending and provide suggestions on what you should aim to spend on specific categories (e.g.: clothes and food), so you can reach your goal.
If this will be your first home mortgage, financial advisors may be even more useful to you. Consider your advisor as a first-time home buyer guide for all of your questions along the way. Some financial institutions, like Ameris Bank, offer special first-time home buyer programs, which offer discounted home loan rates, one-on-one guidance, and reduced down payment options.
The benefit of having a mortgage loan through a bank is banks often package loans in-house with consideration of their underwriters, so they have more control during this process. Choosing the right mortgage lender to stick with you throughout this exciting process is a crucial step in the home buying journey. Not only will they help guide you towards the most reasonable rates, but also share their expertise throughout the entire process.
If you're in a time crunch, you are going to want to get most of the busy work out of the way early on. If you want to appear more serious to those selling their homes, you should first secure a mortgage pre-approval. This also provides lenders with the information they need when you decide to apply for a home loan. In addition to ensuring your credit score is mortgage-worthy, a lender will ask you for information, including but not limited to, your social security number, employment details, bank account numbers, tax returns from the past two years, and your intended down payment.
All the money you’re saving for your new house needs a safe place to grow. While most people have a savings account, trying to save for your home down payment within a year requires a higher interest rate option. Ameris Bank offers high yield savings options to put your money on a faster growth track. Typically, a traditional savings account will offer a very low interest rate (less than 1%), while a high-yield savings account, money market or CD can provide a significantly higher rate. For a better idea of how much money can grow in your savings account, use a compound interest calculator.
Buying a house can be achieved if you plan for and are dedicated to saving and being financially responsible. Ameris Bank is here to help you navigate all of life’s milestones, including buying your first home. Contact our mortgage banker team to see how we can help you along your homebuying journey.
Sources:
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Ameris Bank is not affiliated with nor endorses any of the companies featured in this article.
Learn How Much House You Can Afford
To begin your home buying journey, you need to learn your range of affordability. There's nothing worse than searching for your dream home and realizing that you ended up looking at homes you can't afford. One important point to keep in mind is that just because a mortgage lender says that you can take out a mortgage for a certain amount, doesn’t always mean that you should. To avoid this common mistake, Ameris Bank offers various tools to ensure you know how much house you can afford ahead of time.For a quick way to plug in numbers, run current home loan rates, against a home loan affordability calculator. To ensure you meet your financial goals, you will first need to establish a down payment budget. Keep in mind your timeline for this budget. If you want to save for your first house in 12 months, you must represent that in your spreadsheet. It’s also important to consider the length of the mortgage loan and how comfortable you feel paying it off. Consider the 12/25 rule of thumb: a 15-year fixed-rate mortgage should make up no more than 25% of your monthly income.
Seek Help from A Financial Advisor
For assistance with sticking to your budget and ensuring it is realistic, contact a local financial advisor. They can provide you with helpful tips on how to improve your chances of being able to save for your first home. He or she can recommend where to cut spending and provide suggestions on what you should aim to spend on specific categories (e.g.: clothes and food), so you can reach your goal.If this will be your first home mortgage, financial advisors may be even more useful to you. Consider your advisor as a first-time home buyer guide for all of your questions along the way. Some financial institutions, like Ameris Bank, offer special first-time home buyer programs, which offer discounted home loan rates, one-on-one guidance, and reduced down payment options.
Pick The Ideal Mortgage Lender For You
The benefit of having a mortgage loan through a bank is banks often package loans in-house with consideration of their underwriters, so they have more control during this process. Choosing the right mortgage lender to stick with you throughout this exciting process is a crucial step in the home buying journey. Not only will they help guide you towards the most reasonable rates, but also share their expertise throughout the entire process. If you're in a time crunch, you are going to want to get most of the busy work out of the way early on. If you want to appear more serious to those selling their homes, you should first secure a mortgage pre-approval. This also provides lenders with the information they need when you decide to apply for a home loan. In addition to ensuring your credit score is mortgage-worthy, a lender will ask you for information, including but not limited to, your social security number, employment details, bank account numbers, tax returns from the past two years, and your intended down payment.
Utilize A High-Interest Savings Account
All the money you’re saving for your new house needs a safe place to grow. While most people have a savings account, trying to save for your home down payment within a year requires a higher interest rate option. Ameris Bank offers high yield savings options to put your money on a faster growth track. Typically, a traditional savings account will offer a very low interest rate (less than 1%), while a high-yield savings account, money market or CD can provide a significantly higher rate. For a better idea of how much money can grow in your savings account, use a compound interest calculator.Buying a house can be achieved if you plan for and are dedicated to saving and being financially responsible. Ameris Bank is here to help you navigate all of life’s milestones, including buying your first home. Contact our mortgage banker team to see how we can help you along your homebuying journey.
Sources:
- https://themortgagereports.com/first-time-home-buyer/page/2
- https://www.ramseysolutions.com/real-estate/save-down-payment-while-renting
- https://www.creditkarma.com/savings/i/high-yield-savings-accounts
- https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Ameris Bank is not affiliated with nor endorses any of the companies featured in this article.