What’s even better than recurring savings account deposits? Automated savings account deposits that you don’t have to remember to execute each month. Most banks allow recurring savings transfers from internal or external checking accounts. Examine your budget and determine how much you can afford to save each pay period or month, and then make it happen, preferably on the same date (or the day after) you receive your paycheck or direct deposit. Again, consider a separate savings account just for your down payment fund. If you’re looking to open a new account, go with one of these bank account promotions so you can make the most of the opportunity.
Founded in 1976 to provide independent brokerages with a powerful marketing and referral program for luxury listings, the Sotheby's International Realty network was designed to connect the finest independent real estate companies to the most prestigious clientele in the world. Sotheby's International Realty Affiliates LLC is a subsidiary of Realogy Holdings Corp. (NYSE: RLGY), a global leader in real estate franchising and provider of real estate brokerage, relocation and settlement services. In February 2004, Realogy entered into a long-term strategic alliance with Sotheby's, the operator of the auction house. The agreement provided for the licensing of the Sotheby's International Realty name and the development of a full franchise system. Affiliations in the system are granted only to brokerages and individuals meeting strict qualifications. Sotheby's International Realty Affiliates LLC supports its affiliates with a host of operational, marketing, recruiting, educational and business development resources. Franchise affiliates also benefit from an association with the venerable Sotheby's auction house, established in 1744.
If you already own a home, simply call your insurance agent and let them know you’re buying a new home. They will handle writing a new policy. If you don’t have an insurance agent, now’s the time to find one because your lender will require homeowners insurance. Even if you don’t have a mortgage, insurance is a critical part of protecting your investment. You’ll also want to give utility companies your move-in date to establish service. There’s nothing like moving into a cold, dark house because you didn’t get an account with the power company!
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In the short and medium run, it’s much safer to invest in FDIC-insured instruments such as traditional savings accounts, certificates of deposits (CDs), and money market accounts. Though these instruments have relatively low yields – currently below 2% APY in most cases (UFB Direct is currently at 2.45%) – the risk of principal loss is extremely low. If you want your down payment to actually be there, in full, when you need it, save investments in FDIC-insured accounts are your ticket.
The advent of online banking makes it easier than ever to save small amounts of money without even realizing it. Some major banks, including Bank of America (Keep the Change) and U.S. Bank (S.T.A.R.T.), empower deposit account holders to save their spare change from every transaction using apps that automatically round debit card payments up to the nearest whole dollar and sock away the remainder in a savings account.
Government-backed loans require borrowers to pay for some form of mortgage insurance. With FHA and USDA loans, it’s called MIP, or Mortgage Insurance Premium. For VA loans, it’s called a Funding Fee. The insurance covers potential losses suffered by mortgage lenders when borrowers default. Because insurance protects lenders from losses, they are willing to allow these low down payments.