If there’s one thing that can help you get approved for a mortgage, it’s a large down payment. Showing the lender that you have a vested interest in the property lowers the risk the lender must take. Putting more money down can help you cancel out negative factors such as a lower credit score or higher debt ratio. Your willingness to put your own money on the line shows lenders your seriousness in buying the home.
What if you don’t have a lot of money saved, though? Here are the top ways you can save that higher down payment without sacrificing too much.
Automate Your Savings
The easiest way to save a large sum of money is to make the saving automatic. If you already have your check direct deposited into your checking account, allow a percentage of it to go into a savings account. Make sure it’s an account you won’t touch, though. This way you won’t have the opportunity to spend the money – it’s not in your checking account, so you will forget about it.
You can put as little or as much as you want in your savings account. We recommend starting out with a small amount that you won’t miss. Then you can gradually work your way up as you adjust your budget to allow for more savings. Before you know it, you’ll have a decent amount of money to put towards your home.
Don’t Spend Windfalls
Windfalls are awesome because it’s a large sum of money that suddenly lands in your lap. Maybe it’s a tax return or an inheritance. There could be hundreds of reasons you get one. What matters is what you do with it. If you treat it with the ‘out of sight, out of mind’ mentality, you can put it right into your…