Buying a home is one of those pivotal moments in life you’ll never forget. Your first home is the place where you’ve finally decided to plant roots and invest in your future. But there is more to buying a house than finding a lender and signing papers.

Take a look at these helpful tips you may not have considered when looking to save money to buy a home.

Understand the Different Types of Mortgages

Firstly, it’s important to learn about what types of mortgage loans are available. It doesn’t necessarily mean you’re eligible for all of them, but there could be options you may not have considered.

Physician mortgage loans, also known as doctor loans, are a type of mortgage that caters to specific professions such as nurses, doctors, dentists, and other individuals in the medical field who have mass amounts of student debt. 

USDA mortgages are loans provided to individuals who may be able to afford their monthly mortgages but don’t have enough money for a downpayment. These properties are primarily in rural areas as it is run by the US Department of Agriculture.

More commonly known home loans include a 15 or a 30-year fixed-rate mortgage that withholds interest for the entirety of the loan duration. There are several other types of mortgages out there that are available based upon various requirements such as income, credit score, or professional association.

It’s important to do your research to figure out which type of mortgage would be best suited for your needs. There are a plethora of online mortgage calculators you can use to give you an estimate of what a downpayment would look like with various types of mortgages and interest rates.

Get A Better Grasp On Your Current Expenses

Next, it’s time to start getting a better understanding of what your current financial situation looks like. You may have gotten a promotion at work which has stemmed your curiosity into buying a house. However, if you don’t know your current income to expenditure ratio, you might not be in a great financial place to afford a home.

See how much you are currently making after taxes. Exclude any and all bills, including rent, utilities, gas, food, extracurricular activities, monthly subscriptions, and anything else that is taken out regularly. This includes monthly deposits into your savings, a Roth IRA, or a 401k account.

Don’t forget to include your student loans, credit card payments, and any other accumulating debt you might have. This plays a significant impact in your credit score which is why it’s crucial to stay on top of all of your payments.

Once you have your final number, determine how much can specifically be put away towards your downpayment savings. Keep this separate from your current savings account that is used for unpredictable life circumstances, like a repair on your car or a medical expense.

It’s not to say that you won’t be able to afford the house of your dreams, but it is an important step to help you determine how long it could realistically take you to get there based on the mortgage research you’ve done. 

Now you can look into getting pre-approved for a loan so sellers will take you more seriously as a potential buyer.

Leave Room In Your Budget

When determining how much you need to save for a downpayment, you need to take a look at your budget. However, what many people tend to forget once they’ve been approved for a specific home loan amount is leaving room within the budget for extra expenses. This includes closing costs, agents fees, and other things that are tied into buying a home.

For example, just because you get pre-approved for a home mortgage of $400,000 doesn’t mean that’s what you should spend on a home. Talk with your real estate agent, so they can give you a better understanding of how much you can realistically spend.

Looking to buy a house isn’t a one-step process. It’s more than looking at Zillow and setting up a showing. Take it one step at a time and when in doubt, ask a professional realtor to help.