House Savings

I was reading the 100K posting from a couple months back and it sparked a question in my head. How did you save for a down payment on your house? Did you just put it into a regular savings account to come up with 20% or did you go the FHA loan route? Any and all information is appreciated!

TIA!

Re: House Savings

I am not sure what the 100K post was about but for us we only put 3% down with a FHA and we really had nothing in savings BUT we spent what I assume most must think not a lot of money on a house and what we pay for our mortgage with taxes, homeowners insurance, etc only ended up being a about $500 more then what were paying in rent (and really its less because we were looking to rent a bigger place so my rent would have been much more closer to my current mortgage) also my rent never included any utilities so we paid all of that ourselves too

so for us buying a house with nothing really in savings and not a lot a money down made complete sense for us and worked better for us

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I would bank a check a month when we were saving for a house
But we also had money already saved from when I was a kid- my parents had opened up CDs for me in the 70s when the interest rates were INSANE. Like 14% interest on some of those CDs from back then!

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We didn't save anything! Seriously. But we bought back in 2005 when you were able to get zero down mortgages. All we paid we were closing costs. We 100% financed our home...............80% traditional mortgage and 20% HELOC which was later refinanced into a different type of loan. We never carried any PMI on our house.

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We live off my checks as best we can and put all of DH's paychecks into savings. We have over 20% of a down payment and still can't get a %$&@*^%*#@% mortgage.

House Savings

We had money saved from our wedding. We put about 4-5% down on an fha loan.

House Savings

We used my inheritance from my mom passing for a down payment. Our mortgage payment is actually less than we were paying in rent. We put down about 35% and have a crazy low interest rate. After closing we still had about 100K in savings.

House Savings

We put down 5% with an FHA mortgage and the down payment and closing costs were given to us by my dad. He asked me did I want the money for a house or a wedding and I told him house!

DH and I paid for our wedding.

House Savings

We bought in 2010. We put 3.5% down which was only 9k. All our saving was from gifts from our wedding. I don't think we could have done it without that, it's not easy

House Savings

I was always a saver--lived very simply and was never into clothes, makeup, going out. When I met DH, I turned him into a saver too.

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We were moved by my husband's job out of state and that came with a housing benefit. We used that plus wedding gifts and our savings for the downpayment. We are trying to sell that house now and it is priced a lot less than we purchased it for ten years ago so that housing allowance is gone.

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I lived at home before getting married and I think that was the only way I was going to be able to save any $ for a down payment. We ended up putting down 20%.

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We both lived at home, so saving wasn't as difficult. We bought our house in our early 20s. We put 3.5% down, and it is a small house.

We are trying to save for a larger house...it's much more difficult now. We just do the best we can...we aren't in an immediate frenzy to move.

House Savings

We did about 8% of purchase price in 2012 Conventional loan. Had PMI for about 2 years, during which time we fought to have it removed because the house appraised for a lot more than we paid and PMI should only be paid on APPRAISAL of house, not purchase price, per Federal law. We had it removed, and we have about 40% equity in the house now. In terms of how we saved, we follow the rule of PAY YOURSELF FIRST. By that I mean, you pay your bills, and then you pay yourself, in other words you put money down into savings that you don't touch, can be any amount you feel comfortable with, and then leave yourself whatever amount of spending money you want.

House Savings

Thank you ladies! We are trying to figure out how we can save right now. I would out of work for 2 years and recently went back. Our savings is less then $1K because of it so it's pretty much like starting from scratch. We pay for daycare so we're trying to come up with a savings for a down payment and looks like it almost will never happen with we have to put down 20%.

Re: House Savings

Wedding money.

FWIW though, on LI, if you don't have money in savings, IMO you are putting yourself in a terrible financial strain to be a homeowner.

Anything can go wrong at anytime and it's good to have a very decent cushion to fall back on and not credit cards.

I know the year after we bought DH had a bad year in business so our savings was shot.

It's been very hard to recover from that.

Anything renovations costs major bank too.

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House Savings

We did 5% down. With closing costs and down payment that still amounted to almost $40K. We stood with $$ in savings for a just in case fund too.

This was money we saved throughout the years. Kudos to those who are able to save the 20% down but if we would have waited for that we would never be able to afford a home when our DC is still young.

Re: House Savings

Just fyi - to the OP -

It's a misconception that you need 20% down to do a conventional loan. Many of my buyers have done as little as 5% (and I believe you can now do as little as 3% with a conventional loan), but of course you will pay pmi. But the pmi on a conventional loan is less than with an FHA, and it does not have to stay on for the life of the loan (it can be removed when you have enough equity).

You do need to have better credit and debt-to-income to go to a lower down payment on the conventional side.

It can help to speak to a mortgage professional to weigh out your options. With rates still being relatively low, many of my buyers prefer to put less down and conserve some cash for closing costs and house renovations. Or, even if they only have the minimum down, they prefer to buy now than risk rates going up while they save a little more (which will ultimately be more costly in the long run).

However you choose to save, you obviously have to have the money in liquid form when it's time to make your down payment. I have a lot of buyers that tell me that they have x dollars, but it's in a retirement account, tied up in investment accounts, CDs, etc.

Let me know if you need a recommendation to a mortgage loan officer... the good ones really know how to advise you of your options and the pros/cons of different loan types and down payment scenarios, even if you are not quite ready to buy.

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We did 3.5 down w FHA and rolled closing costs into mortgage. That's the Only way it was gonna happen. We have PMI for 5 years and that's almost up. its worked out fine with us.

Re: House Savings

$3,000 wedding money
$37,000 parents saved over the years

We had our wedding money just in our bank account. Not sure about the rest.

Re: House Savings

Someone I work with is saving with this programfirst home program
A couple of banks offer similar programs.

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For our first house DH had a ton of savings, so we were able to put down the 20% no problem.

The next house is a combo of the profit we make off our first house and money we have saved over the past 2 years (we take about 1 paycheck a month and put it in savings). We'll be putting 15% down on the next house.

House Savings

We banked half of my pay check in a savings account. We spoke to a financial advisor about finding something with higher interest and his advise was that a savings account was the only safe and guaranteed way to save the money (because of our uncertain timeline of when we would buy).