Down Payments

The idea of paying off your student loans and buying a home at the same time can seem like an impossible feat given the impact on your Debt-to-Income (DTI) ratio. However, there are ways it’s possible to have enough funds and good enough credit to make your dream of home ownership come true a little more quickly. If you’re currently considering how to manage both, here are some options you might want to consider.

Decrease Your Debt

Lenders will be looking at your DTI ratio in order to determine whether or not you’re a solid financial bet, so before throwing yourself into the market, it can be a good idea to minimize your debt load. While this doesn’t mean paying off all of your student loans, try putting more down over a period of a few months so you have additional wiggle room. By making a budget plan that you can stick to, you’ll slowly eat away at the principal and have a little more room to invest when the time comes.

Add Another Income

You’re probably working pretty hard in your post-student life to make ends meet and pay off debt, but one of the best ways to pay off two loans is to bump up your income. Whether you decide to find something part-time on the weekend or hone one of your skills for freelance profit, a little bit of extra money each month can make a huge dent in the amount you owe in no time at all.

Consider A Starter Home

It’s entirely possible that you’ve got your eye on your ideal home, but if you’re dealing with student debt there’s a pretty good chance that the monthly payment will be unattainable. Instead of choosing a home that’s out of your league, make your dream of ownership come true by picking something that will be affordable month to month. While it might not be exactly the house you’re dreaming of, you’ll still be putting equity into something so you’ll have money to invest down the road.

It’s certainly not an easy feat to take on student loans and mortgage debt at the same time, but by improving your income and paying down as much as possible before investing, you may be able to do both at once. If you’re currently in the market for a home, contact your trusted mortgage professionals for more information.

Autumn is a popular time for new home buyers to start looking for their first house or condo. But with that down payment looming, everybody could use a bit of help saving up to make that bulk payment a little less intimidating.

There are plenty of unconventional ways to save up that may seem small, but will quickly add up and put a dent into that down payment.

Create A High Interest Savings Account

Talk to the bank about creating a secondary savings account with a higher interest rate. These super savings accounts usually come with the caveat that no money can be removed for a designated period of time. Using this account for the down payment works in everybody’s favor because it guarantees those extra dollars cannot be used for any other purpose.

Discard One Guilty Pleasure

Enjoy Starbucks coffee? Grab a pint every happy hour? Choose one vice and put the amount that would be spent on it into a jar. Most people will be surprised on how much money they spend each month on one guilty pleasure that can easily be cut out of their life. Every perk that’s cut will increase the amount by a decent margin.

Put Away Any Bonus Money

Holiday bonuses from work, tax refunds, birthday or Christmas presents, income from side gigs, any and all extra dollars that come in from any source outside of the main paycheck should be considered ‘down payment dollars.’ Sure it’s tempting to use that nice bonus or tax refund on a weekend trip or a night out, but all extra income should be saved away for that initial down payment.

Bring On The Roommates

People who already own a home and are looking to relocate can take this unconventional approach. Decent housing is hard to find so anybody with an extra room can rent it out and put that money towards the new house. Having a roommate can be a pain, but it’s for a limited time and can add up quickly.

While saving for a down payment can be stressful, you don’t have to go through the process alone. Your trusted mortgage professional will be able to guide you and provide some helpful tips for how to make that down payment without breaking the bank. These men and women have seen countless couples go through the same thing and their experience can make a world of difference.