Saving for a down payment can be tough. When you’ve got bills to pay and are trying to make ends meet, saving money to put towards a home can be difficult and stressful. Add a pandemic into the mix, and you wind up with a whole new set of challenges.
But despite the events that have transpired in the past couple of years, first-time homebuyers are still finding ways to save money to buy a home. A recent survey conducted by Redfin found that buyers are using stimulus money, savings from staying in during the pandemic, and even second jobs to save money for a down payment.
How First-Time Homebuyers are Saving for a Down Payment
When buying a house, the first step is to save enough money to make your down payment. Though 20% is considered ideal, usually buyers need to save at least 3% of the purchase price to buy a home. While this may sound daunting, it is possible.
Even with the pandemic at hand, buyers are still finding creative ways to save. Here are a few.
Despite the pandemic, many people who bought homes in the last year were able to save part of their paychecks to use for a down payment. According to the Redfin survey, 52% of first-time homebuyers were able to use money directly saved from their paychecks to fund their down payment.
Saved Stimulus Checks
Chances are, if you’re like most Americans, you probably received stimulus checks during the pandemic from the U.S. government. While most people used these checks for miscellaneous expenses, others put them towards a down payment on a home. Though the economic impact was severe, the pandemic helped many first-time homebuyers with being able to afford a down payment.
Extra Pandemic Savings
When the pandemic hit, many people started working from home. They saved money on fuel, eating out, and many other expenses. Social distancing also prevented people from going out and spending money in ways that they normally would, like going to the movies or hanging out at a bar. For many people, this resulted in lower monthly expenses. Some put the savings towards a down payment on a new home.
Get Advice From an Expert
Are you struggling with finding ways to save for a down payment? Let us help. We specialize in working with first-time homebuyers. We’ll walk you through your options and help you get information about down payment assistance options such as grants and zero down options that you may be eligible for if you qualify. Contact Mortgage Solutions Financial to get in touch with an expert today!