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Practice English Speaking&Listening with: 3 things you need to buy a home

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Whether youre considering a house, condo, or even a tiny home, there are 3 major factors

to consider when buying a home: how much your house is going to cost, your timeline, and

the money you need to buy that house.

As an example, lets imagine you want to buy a house thats $250,000.

You will need anywhere from 3 to 100% of the cost of the home available in cash to purchase

it.

This is referred to as your down payment.

In decades past, you often needed a 20% down payment, but thats not the case anymore.

Its great if you can put 20% down, but it is a mythological requirement.

For most people, saving 20% might not be the best idea since it can imply that you rent

for longer which costs a ton of money.

On the other hand, having too little cash can be just as problematic since you may not

get the best mortgage options or terms.

To strike a healthy balance, our goal is for you to get to 10% of your purchase price.

This is a solid place between having too little cash and saving for too long that will allow

you to build a healthy down payment amount to buy a home.

So in our example, 10% of the $250,000 price is $25,000.

This may seem like a lot of money, but this is how you can get there.

Think about your timeline.

Lets say you want to buy your home in 2 years, which is 24 months, you will need to

save a little over $1,000 a month.

If you and a partner are saving together, you would each need to save $500 month if

youre splitting the savings goal evenly or you can split it up according to your ability

which might be 70/30, 40/60, or some other proportion that works for you.

Estimate the cost of your new home, figure out your timeline, and determine the amount

youll need to set aside in a separate savings account, so that you can build up your down

payment to get to your new home.

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