5 Creative Ways To Save For A House Deposit!

If you are making average $30,000 a year, the thought of saving for the 10% home down payment can seem daunting. Yet with a little dedication, time and sheer will; you can get there regardless of age.

We will talk about the concept of down payment before we dive deep into the tips to save on down payment so that you will be able to get a better outlook.

Down payment means a portion of the total sales price of your home, which you will need to pay upfront to buy a house. The rest of the payment to the seller comes from your mortgage which will be approved by the banks upon successful purchase by you (as a buyer). Down payments are normally expressed as percentages which in usual cases are 10% from total property sales price. Normally, 3% will act as booking price with estate agents and 7% which you will have to pay to your elected lawyers in a form of bank cheques in order to proceed with your purchase process.

However, be mindful that the 10% deposit usually applies to subsale properties (properties that you buy from an existing owner). These days there are various numbers of buying schemes that allows you to buy homes without the deposit payment of 10%.

And here comes the tips.

TIPS 1: SAVE MONEY FOR THE BETTER

A great stock investment coach once advised me that, “you are your own fund manager!” – and I feel that it’s downright true. Regardless which investment vehicle you are going to use to multiply your hard earned money, nothing is better than knowing what you are investing into.

As a rule of thumb, most financial advisors would suggest saving your money 10%-15%. In other cases, you might also be able to save up to $1,300 per month from a salary of $3,000 – it’s possible. However, if you want to speed things up then you might want to consider saving up to 25%-30% of your net income. The savings will be further boosted by cutting off unnecessary expenses such as cancelling dining out every night, taking public transport to work, collect your tax refunds, save your bonuses or even as simple as parking in a free zone – it makes a huge difference.

Looking for ways to boost your savings further? Invest your savings or better yet, invest in businesses where you might think would make huge returns!

TIPS 2: DO A SIDE HUSTLE

With the rapidly changing economic landscape of countries globally, the gig economy is getting even more popular these days. Developed countries would try as best as they could to find the cheapest yet highest quality set of skills to get their errands done.

With reliable gig economy funnel such as Fiverr and Upwork, you can earn up to USD $25 an hour. This includes simple tasks such as translations, data entries, and even app designing – try it out!

TIPS 3: REFINANCE YOUR PROPERTY

Let’s say you have a house and it seems that the value of your property has gone way up after years of staying. Well, maybe it is high time you should research how many margins of loans you can get out of your home refinancing. It is a good way to consolidate and/or eliminate various debts with various interest rates that you wish would go away and focus on only one stream of debt with one interest rate.

However, be aware that refinancing would also mean to incur a new loan. Do your researches and make sure that you only leverage on loans in order to make more assets and money for you in the foreseeable future. Rich people are rich because they know how to leverage on loans to make their life better financially.

TIPS 4: BUY A CHEAPER CAR OR DOWNGRADE YOUR CAR

It is undeniably hard to restraint yourself from buying that car you have always wanted now that you have the financial means to maintain the car. However, cars are depreciating assets and its values drop every now and then.

If you are able to at least restraint yourself from buying that high-spec Honda City, and instead opt for cheaper alternatives – you will be able to save or invest the monetary differences between the two cars.

Better yet, you would be paying lower installments and lower maintenance fees for a second hand car and have better credit scores in eligibility to own a house!

Have a read down below to know how you can work your way to better credit scores (CCRIS) so that you can get better chances of getting your loan approved by banks :

4 Secrets You Should Know To Get Your Loans Approved !

TIPS 5: CONSIDER HOME BUYING SCHEMES

With the aid of governments and other related bodies, various housing schemes are introduced to help easier purchase of properties for home buyers these days – better yet, without the 10% deposit.

These includes many major government aids for home buyers across the globe such the “Own Your Home” scheme in UK and many major countries.

In addition, these are the schemes outlined in Malaysia to encourage more home buyers:

  1. PR1MA
  2. Skim Rumah Pertamaku
  3. Perumahan Penjawat Awam 1 Malaysia
  4. MyDeposit
  5. RUMAWIP
  6. Rent to own
  7. BSN MyHome (Program Perumahan Rakyat)

Now that you have reached the end of this article, you sure are serious on finding ways of becoming a home owner. Best of luck to whatever goals you want to achieve by owning a house. Hope this article helps you in your quest. I am excited for you, the reader – for you will be embarking on a journey that will truly be life changing.

“The man on top of the mountain didn’t fall there”

~Vince Lombardi

5 things you should consider before buying your first house

Nothing beats one of the best feelings rather than having a roof over your head but the greatest thing to know is – you own it! After working for about a year right after college, I managed to buy my first house. I went through all the process – finding the right house at the right place, did my credit checks with the banks, and arranged a house visit with a property agent which I get to trust. Overall, it was not a straight forward process as there were many questions I asked – whether the land title has been issued, the current unit’s market price , or even the issue of why the current owner is selling the unit. Here are the 5 things you should know before buying your first house.

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1. Do you want it or do you need it?

Whenever you decide to buy a house is always to determine whether you need the house? or do you want the house? .Need and want are two different things and are quite simple to distinguish, that is in theory. A need is something that you really require to carry on your daily life; a want is something that springs out of your desires and may not be very crucial to your current life.

If you think you can finally buy a property without stressing out your life too much – then you are all set! However, in some cases buying properties may get you in heaps of trouble – having to settle the loan installments late or always on a tight budget, then maybe you need to reconsider your purchase decisions.

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2. Is the house for investment or for your own stay?

This question changes a lot of things if you ask yourself. If you consider to buy it for own stay, you might want to buy the house in a descend environment, be it in a suburban area or the city. You might also prefer a better house condition if that’s the case, Then again this is all up to personal preferences. However, it will be quite different if you buy a house for investment purposes because you would need the house at places with high population, malls, offices, public transport, and etc. to get good rental income.

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3. Do you have an exit plan?

An exit plan should always be the planning stage in case if your property purchase could go haywire – fake property agent or owner, or maybe unsettled installments down the road. These possibilities must be simulated so that you will be able to anticipate preparations if these scenarios happen – yikes! But at least you will be able to know just what to do and panic less if it does happen, right?

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4. Do you have enough money?

As cliché as it may sound, yes, it is important to assess your ability to purchase the said unit. This is because there are times where property agents only wants to secure their share of bargain, their booking fees of 3% out of the total 10% deposit. Sometimes, these agents do not assess our financial credibility. It is up to us to assess our own so that we won’t lose out.

Let’s give an example,

You want to purchase an apartment costing RM 170,000 and you have a salary of RM 3,000 – which is still alright. You also have in your savings RM 17,000 which is just enough to pay for your 10% deposit of RM 17,000 from the apartment’s total cost. There is still to pay for the legal fees which is by the lawyer, oh no! this will normally cost around RM 7,000 that needs fork up. Hence, always take into consideration all costs associated with purchasing a house including the hidden costs and you will do fine.

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5. It is alright to wait.

Sometimes it is just better to hold your purchase. I am not saying that you should not buy a property at the soonest, sometimes if you hold for a moment and reassess your decisions then you might think – nahh maybe this property is not too good a deal or you might just realise that you may be in a worsen condition if you proceed with the purchase. Being in a situation where you don’t have to worry about your daily finance is better than having to maintain a house and constantly struggle to meet ends meet – but that is just my personal opinion. Not all property investments makes great money – some of the investments might get you into serious financial trouble, learn and plan right. To sum up, buying a property is always a great idea especially if you have the stable financials and the right knowledge.