To get yourself a dream house, you always need a big amount of deposit. However, building up a deposit is never ever easy thing to do. But, with a good savings strategies and well discipline, you will soon have the deposit for your first home.
Follow our ways to make it more manageable and turn your dream into reality;
1.How Much Of A Deposit You Need To Save
Every first-time home buyers need to put down a 10% down payment on their home, and lend the other 90% from the bank. If a property worth around RM 200k, you then need to save at least RM 50k, which included the upfront cost of legal fees, stamp duty and decoration. (Click here to understand how much legal fees and stamp duty for purchasing a house)
Don’t panic if you see RM 50k you need to save, wherever you are buying, there are schemes and deals can help you up. The government is offering MyDeposit Scheme and MyFirstHouse Scheme for first time home buyer. Besides, some of the banks or developers are also offer special mortgage deals to those who struggling to purchase a house. To get more details about these deals, do arrange a time for you to shop the property fair and search the loan package from every banks.
2. Manage Existing Debt
Having debt can hold you back from saving effectively and it can drag down the chances of being approved for a home loan. Especially credit cards, it’s not so surprising to understand that there a lot of people couldn’t mange how to use a credit card. Have you ever ask yourself, “do you really need one?” please think about it twice.
Besides, please pay off your debts on time, such as utilities bills, phone bills and credit cards bill. Its all about your personal credit score, which is lenders will decide whether approve your mortgage loan application by referring to you personal payment history. (Click here to read more about the credit score)
3. Be Smart With Your Money
Once you know the amount of deposit you will need, make a plan to reach this goal. How long it will take is depends on how much you can afford to set for each month.
For example, if you want to buy a house in next 3 years and you will need RM 20,000: you need to save around RM 556 a month. But consider to you current financial situation , you feel can only save around RM 200 a month, you will need to re-plans on buying house in just over 5 years time.
Another option is try to cut down on the things you don’t actually need to buy and only buy it during promotion. Every little bit counts can maximize your opportunities to save.
4. Create A Second Income For Yourself
Should you want a good idea on how to get a deposit quickly, then there is nothing better than generate second stream income for yourself.
It is likely that you could use your skills that apart from your workplace. If you good at design stuff, then you may find the part-time job from other small business. For example, there is a restaurant or cafe is going to opening, and they need someone to design a food menu for them. Now, it is your chance to express your talent to them and earn some extra pocket money.
5. Find A Saving Option
Once you know how much you can save for every month, its time to make your money work for you. Do search which bank has offer high interest rate, or you can choose either short-term savings or medium-longer term saving. Once you have sign up a saving account from whatever bank, do read carefully the terms & conditions. Review your savings account at least once a year to check whether you are getting the best interest rate.
When you are getting closer to reach the deposit you needed, you can start to planning by thinking about your dream house location and proximity to amenities like schools, public transport and shopping mall.