Options For Coming Up With Your Down Payment

Consider the price of the house you can afford and determine 20% of the value. That’s your target. Let’s say it’s $50,000. Divide that number by your time horizon. If you want to buy in five years, divide by five — you’ll need to save $10,000 per year. Divide that number by 12, and you’ll get your target monthly savings goal: $834.

Perhaps you want to buy a home sooner. You can shorten your time horizon by saving more each month if your budget allows.

People get money for a down payment through a number of different methods.

Even small contributions add up over time, so be vigilant about looking for ways to cut costs or save more and shift that cash to your down payment fund.

Another way is to pull money from your retirement account for your down payment but this should not be your first choice.

* Excerpts taken from article published on Trulia.com