When you were younger and would think about dream home, you didn’t give any thought to needing a mortgage to pay for it. And you certainly didn’t give any thought to the deposit that you would need to provide, either!
If this has caught you off guard and you are frantically trying to save for a deposit before you meet your mortgage broker or lender, below are some tips to help.
Time to Move
If you already have a good idea of where you want to live then the chances are that you are also renting in the area so that you can stay close to the action. And while may be good for your social life, it doesn’t help your home deposit.
Instead, look for an area within proximity to your dream suburb which has remarkably reduced rent. This is the best way to have almost the best of both worlds, being close enough to enjoy the amenities but far enough away to not pay to have to pay for them.
Keep a Tight Budget
The worst thing that you can do with a budget is to make it too unrealistic. This does nothing except to leave you to make a small blowout which then turns into a series of other small blowouts until you’ve used up your savings.
Instead, include items like going out and entertainment in your budget. If you can, buy your treats in advance. You can pick up vouchers from the Groupon Coupons page for Omaha Steaks or even buy some general admission movie tickets at the start of the month and then use them at your leisure throughout. This is a great way to keep your budget on track while still enjoying life.
Consolidate Your Debt
If you are paying the minimum or just over the minimum amount required each month on a range of debts then you are doing nothing except treading water and beefing up your credit provider’s profits.
Instead, look for a debt consolidation loan which can transfer all of your existing lines of credit into one large amount. While seeing your debt in one big sum may seem intimidating, because your payments are actually effective, you will see the overall debt decrease each payment, not stay the same or even rise!
Switch to Direct Debit
One of the worst things that you can do is to pay your bills late when you are trying to save. Why? Because the amount of late fees that you get charged needs to come from somewhere, and it’s often your despotic saving account.
For this reason, switch to direct debit to ensure that your payment are all made on time and you don’t accrue unnecessary fees.
When it comes to saving for a home deposit, every little bit helps. Look through your budget and your spending habits for any changes you can make to put even more into your savings. It all adds up.
