A few days back I was talking with a young couple that wanted to know how they would get into a home with the market the way it was. I thought about that statement for a moment and asked them if their credit was ok. They said that for the most part it was good but needed a little work. Ok! That would take some time but not forever. They both had a good job, that was good also. They had about 10 months left on a car loan and hoped to have all their credit cards paid in full or at least under 30% within a year.
Looking at the home prices right now and the market, I still fill that it is a buyers market for most situations. Notice I say most but not all. I think they will have time to get the credit bumps taken care of and clear some credit debt out of the way within a year. Having a paid off vehicle will help
The biggest concerns were coming up with more of a down payment and being able to adjust to all the cost of owning a home. Those nice little costs we do not think about until it's broken and needs to be fixed.
I thought about that also and how that is sometimes a real eye opener also for first time home buyers
Well with $5000.00 in savings as of right now and a little work ahead of them I started to get my wheels turning. I thought about these young people that have a dream, a goal to own a home but looking at all the things that would make it hard.
Sometimes we must sacrifice something to gain something else. We must decide what is important. In the middle of the 2 starting to get somewhat depressed in the conversation and almost loosing hope, I asked if I might be straight forward with some questions and my own personal suggestions. They agreed and were interested in what I had to say.
But what was I going to say I thought. I had been watching the both of them chain smoke cig after cig and then it came to me.
The Answer is simple, but not easy I said.
Getting some paper out I and asked a few more questions.
Based on what I was told, I came up with a plan that I would use if it were me.
I asked if I could SHARE my plan with them at the end on what I would do if it was me
They were interested. So I showed them the paper with all my notes.
Smoking! 2 packs a day $2920.00 Not smoking $ 0
Mocha's and lattes + tip 2 a day $ 3285.00 Coffee at home and on the go $365
Cable and movie channels $960.00 Blockbusters unlimited( they already had it)
Movies, popcorn, drinks $522.00 Blockbusters ......
Drinks and Pool $ 2080.00 limit it !!!! $700.00
Video Poker $600.00 Powerball 1 time a week $52
Dinners out $2400.00 Happy hour once weekly $780
Bought lunches $3120.00 Take you lunches $1510.00
$15,887.00 MINUS $3407.00
$12,480.00 SAVED in 365 DAYS
A small sacrifice! You bet!
That is what I would do if it were me and I needed some money in 365 days
I could see the wheels turning at that point.
We all must ask what will we give up to gain something new.
In this case it was explained to me that in 365 days the couple would have saved another $5000 to make a total of $10,000. If they started to modify their spending in the LUXURY area, they would save another $12,480.00 in that same 365 days if they stayed on plan.
NOT BAD! Just think what percentage of that money saved could be used to help with the mortgage later on also.
Even if it was 50% That is an extra $520 ($12,480 *.50)/12 towards the mortgage payment and maybe the other part could be used for those unexpected things that come up or maintenance.
I explained to the both of them that I really am a simple person and if it were I this is how I would do it because it would be a simple way to get from point A to Z. I like simple.
Sometimes things are so simple we don't see them until looked at from a completely different view.
This works in this case, It may not work for you. Really Its YOU that needs to figure out what the simple sacrafice is. Its that simple.
Best to you and yours!
Timothy S. Butterworth
Oregon Realty Company
215 SE 102nd Ave
Portland OR 97216