The Daniels Team's Blog
It's time to find the perfect place of your own but becoming a property investor has one significant roadblock: a down payment. It’s something that can stop potential home buyers in their tracks.
While winning the lottery or inheriting a windfall would be fabulous, you don’t need those luxuries before you can buy a home. What you do need is a budget that gives you a strategy for saving while still attending to daily expenses. The challenge is that once you create the budget, you must protect it from the temptation to stray from it while you work toward homeownership.
Here are some proven savings tips AND the budget-busters to avoid along the way:
Strategies for Saving
Detached account. While it seems obvious, many people lack even one savings account. If you already have an account, open a separate one specifically for your down payment. Make sure that it is detached from your other accounts. Having a savings account designated specifically for your down payment may get you to think before dipping into it whenever other expenses arise.
Different bank. You can open an account at the same institution where you have a checking account but doing so makes it easy to move money back into your spending account. Open an account at a credit union or savings bank to which you'd have to make a special trip to remove funds.
Direct deposit. Have the down payment part of your paycheck deposited directly to your savings account. You'll avoid having immediate access to it. If you don't see it in your checking account, you are less likely to spend it.
Establish a Budget
Now that you have established a place to save funds, you need to create a budget to handle your remaining income. Many online programs will help you to create a budget and keep track of your spending. They are often free or low fee to use, and some give you access to a financial planner at a small cost. Here are some to get you started:
Many people resist living by a budget because it feels too restrictive. The notion that your budget monitors your spending keeps many from reaching even first-level financial goals. Money is a tool to help you get what you truly desire. If you wish to own a home, eliminate these budget-busters that will keep you from getting there:
Overpriced drinks. If your caffeine habit racks up more than $10 every day, consider cutting that expense in half. If you saved five dollars each day, you could add $1825 to your down payment account by year’s end.
Eating out. Just like a daily coffee break, restaurants and fast food meals can easily break a budget. Studies show the average American spends over $250 each month eating out. If that sounds like you, eat out half as often and bank another $125 each month. Over 12 months, that’s $1500 more towards your down payment.
Clothes. Many offices allow casual dress so spending on clothes for work might not be necessary. If you work in an environment that requires professional attire, purchase a few high-quality pieces that you can style in different ways with lower-cost items.
Expensive vacations. The travel bug bites in every season. Even a cheap flight with a hotel and rental car can result in a fairly large expense. Instead, you may opt for a getaway that is within driving distance while you’re working through your savings plan.
These budget-busters could add up to $6000 or more annually. That could be enough to qualify for a down payment when using an FHA loan. Add to that a portion of any extra money you receive throughout the months for bonuses, birthdays, holidays, rebates, and tax refunds, and your down payment account can grow significantly in just one year.
Pursuing a house can be difficult, regardless of the current housing market's conditions. Thankfully, homebuyers who plan ahead may be better equipped than others to enjoy a quick, seamless and successful homebuying experience.
Ultimately, there are many reasons to prepare for buying a house, and these include:
1. You can determine where you want to live.
A homebuyer who knows where he or she wants to live can tailor a home search accordingly. As a result, this buyer can speed up the process of acquiring his or her dream residence.
When it comes to planning ahead to buy a home, it generally helps to know where you want to go. If you make a checklist of home must-haves and wants, you may be able to hone your home search to specific cities and towns. Then, you can pursue residences in these areas and find your dream house faster than ever before.
2. You can enter the housing market with a budget in hand.
You know that you want to buy a house, but you still have no idea how you will pay for a residence. Fortunately, if you plan ahead for the homebuying journey, you can get your finances in order and enter the real estate market with a budget at your disposal.
Generally, it is a good idea to get pre-approved for a mortgage prior to pursuing a residence. A mortgage provides you with a set limit that you can spend on a house. Thus, a mortgage can help you minimize the risk that you'll spend beyond your means to acquire your dream residence.
Obtaining a mortgage can be quick and easy too. Meet with banks and credit unions, and these financial institutions can teach you about a broad array of mortgage options. Next, you can choose a mortgage and kick off your home search.
3. You can find an expert real estate agent to help you along the homebuying journey.
If you plan to enter the housing market, you may want to hire an expert real estate agent sooner rather than later. With an expert real estate agent at your side, you can streamline the homebuying cycle.
A real estate agent knows exactly what it takes to purchase a superb residence at a price that fits your budget. He or she first will learn about your homebuying goals and provide insights into the local housing market. This housing market professional then can customize a home search to ensure that you can achieve your desired results.
Let's not forget about the comprehensive support that a real estate agent delivers throughout the homebuying journey, either. A real estate agent will set up home showings and offer homebuying recommendations at each stage of the homebuying journey. And if you discover your ideal residence, a real estate agent will help you put together a competitive offer.
There are many great reasons to plan ahead for the homebuying journey. And if you start planning today, you may be able to enjoy a stress-free homebuying experience.
Listing a house may seem like a long, arduous process, especially for a first-time home seller. But with the right real estate agent at your side, you can receive expert support at each stage of the home selling journey.
What does it take to hire a diligent real estate agent to ensure you can sell your house? Here are three tips to help first-time home sellers employ the ideal real estate agent.
1. Conduct a Comprehensive Search
Search far and wide for a real estate agent – you'll be glad you did. With an extensive search, you can learn about the pros and cons of working with various real estate agents in your area and plan accordingly.
Don't hesitate to reach out to friends and family members for real estate agent recommendations. If friends and family members enjoyed outstanding experiences with certain real estate agents, it may be a great idea to contact the housing professionals who have helped your loved ones achieve their home selling goals.
Also, look for real estate agents who boast many years of industry experience. These housing market professionals are likely to understand the ins and outs of selling a residence. As such, they may be better equipped than other real estate agents to help you optimize the value of your house.
2. Ask Plenty of Questions
If you find a real estate agent who seems like a viable candidate to help you sell your residence, it is important to set up a face-to-face meeting. That way, you can ask questions and determine whether this individual is the right person to assist you.
During a face-to-face meeting, find out what a real estate agent has to say about your residence. Typically, a diligent real estate agent will conduct extensive research before meeting with you and should be able to offer honest, unbiased home selling recommendations.
Furthermore, there is no such thing as a "bad" question, especially for those who are selling a house for the first time. And if you have questions for a real estate agent, a face-to-face meeting provides an excellent opportunity to get your queries addressed by a housing market expert.
3. Get Client Referrals
Ask real estate agents for client referrals. Then, reach out to past clients so you can better understand how a particular real estate agent has supported home sellers over the years.
If a client offers glowing recommendations of a real estate agent, this housing market professional may prove to be the best choice. On the other hand, a client who encountered problems with a particular real estate agent may help you avoid making the wrong decision as well.
Ultimately, the right real estate agent is someone who can help you sell your house and keep you informed as the home selling journey moves forward. And if you spend some time learning about the real estate agents in your city or town, you should have no trouble employing a top-notch real estate agent who can take the guesswork out of selling your residence.
Starting an extensive renovation or replacement of hardwood flooring can be costly. Thankfully, there are other ways to bring your floors back to life if they are not deeply damaged. If you want to give your floors a facelift, try out these tips.
Give It A Good Clean
Sometimes, all a dull hardwood floor needs to help it sparkle again is a thorough cleaning. To begin, remove furniture and rugs from the space. Lift your furniture to avoid additional scratches or damage. Once the room is empty, vacuum and wipe down the floor with a damp cloth. If your wooden floor is very dirty, use a gentle cleaning product, but in most cases, warm water alone works well. Take care to use cleaning products formulated specifically for wood surfaces. Consider steam cleaning but only if the seal on the floor is in good shape before you begin. Otherwise, the added moisture may worsen the condition of the floor.
Screening and Recoating
Screening and recoating your floor is an effective way to bring the sparkle to your old wooden floor without completely refinishing it. This process works well on floors that are not deeply damaged. The first step is to lightly sand the surface with a buffing machine to prepare the floor for a sealant like polyurethane. Hiring a buffer from a hardware store is reasonable if you have a large area of wood flooring in your home. Once the floor has been buffed, apply a new coat of finish. Be sure to allow for plenty of drying time before bringing your furniture back in. If you have a few smaller areas that are dull or distressed, you may be able to sand by hand then apply a sealant product with a rag.
Consider A Full Sanding and Refinish
If there are deep scratches or other similar damage on your floor, you may consider working with a flooring contractor for full sanding and refinishing. This project can be daunting, but the result is a consistent finish and color. For those that have engineered wood flooring, ensure the veneer or solid wood top layer of your flooring is thick enough to withstand a sanding.
Visit your local hardware store for supplies and advice if you choose to DIY. Otherwise, ask your real estate agent for recommended contractors in your area.