Saving for buying a home: saving for a big down payment

Saving for buying a home

Saving for a down payment on a mortgage is the first big step in buying a home. It goes without saying that the discipline is putting money aside and also deciding where these funds are stored.


How much you will need to save?

When granting a mortgage, the bank needs an down payment to reduce the risk of financing other costs of the house. Banks prefer borrowers who can put down at least 20% of the price of a domestic house. If you have a very good balance or qualify for a specific program, you can get a loan of less than 20% or nearly no down payment. However, it should be remembered that programs that offer a low down payment or do not pay an advance usually require the borrower to pay private mortgage insurance (PMI) for an additional monthly fee. If you are required a 20% down payment this mears $60,000 for a $300,000 purchase.

Conversely, if you are considered a high-risk borrower due to credit history or other factors, the bank may seek a higher percentage of down payment before granting a mortgage. The higher the down payment, the lower the mortgage and the smaller monthly payment.

In general, monthly housing costs should not exceed 28 percent of stable monthly income. As an example, if your income is $ 5,000, you can safely spend $ 1,400 ($ 5,000 x 28%) for a future payment in your home.


The type of housing you should look for

In ski resorts and mountain towns, buying a house is expensive.

Make sure it’s worth buying. Buying a house is probably the biggest financial commitment in life. Be sure to buy instead of renting.

Calculate your home budget with rent. Use the monthly rent as a starting point to realistically pay all housing costs monthly.

Familiarization with the first home buyer program. These programs help you plan for a home purchase and educate you with the home buying experience.

Minimize your lifestyle and save money with the payment in advance. Within 1-3 years before buying a house, think about reducing your lifestyle to save as much as possible on your home deposit, closing costs and transfer costs.

Maximize your credit score. The higher the credit rating to a certain point (around 760), the lower the mortgage rate.

Consider the multi-family houses. Are you interested in becoming a homeowner? Both in the case of conventional payments (20%) and flexible advances granted by FHA or Freddie Mac, loans are available to owners of duplexes and small buildings (up to 4 units), so that you and your family can stay in other residential units.


The best place to store your down payment

Advances must be available easily and quickly, which does not include options such as long-term certificates of deposit (CDs).

1. Investment account

If you are thirsty for higher risk, you may decide to invest your advance in the investment account with a larger broker.

2. A savings account with high returns.

If you want to get more interest without sacrificing the safety of the FDIC insurance, choose a high-performance savings account.

3. Savings account

Depositing into a savings account at the bank where you apply for the loan may be the easiest option


Please contact Grand Mountain Bank at 970-887-1221 with any questions you may have about the home buying process. We would be glad to sit down with you and review your options.

Building your savings account: things you can do on a monthly basis to save and put money away

Saving money does not have to be that difficult. You just need practice, after getting used to investing money constantly, you can save enough money for emergency situations, pensions and other goals you want to achieve. You can do it.  All you need is a positive attitude and an effective strategy that will take your savings to the next level.

Start saving now
Even if the economy is doing well, most Americans have not received a raise for a long time, so it’s not surprising that many of us struggle to save. But saving is better than not saving. The faster you develop your savings habits, the better it will be.

Start with the small and save often. If you cannot earn 1000 USD this month, you will save 20 USD a week.

Set daily, monthly and annual goals.
Having a list of goals you can work on is a good start. But the best thing is that you save money by doing things regularly. Do not just plan to save money because you want to travel to another continent or buy a good house. Find ways to save less and save more every day, month and year. Here are some ideas in case you take out space.

Monthly savings tips
• Save electricity: if the electricity bill is too high, it is time for a change. Find ways to reduce your monthly electricity bill. Switch to suppliers that charge lower prices and make changes to save heating and cooling.

• Lower debt payment: spend too much money on credit cards or student loans? If you increase your credit rating, you may qualify for lower interest rates. Consider reducing the offer and finding out if you can save student loans by refinancing or by submitting a payment plan related to your income.

• Save insurance: look for cheaper insurance from other providers. And figure out if you can afford a higher refund.

Define your objectives clearly
Some people are not motivated to save money. Others want to save money, but do not know where to start. That is why it is important to establish specific and realistic goals. Once you know why you are delaying part of your salary, it is easier to save than to spend extra money.

Make sure you have enough money to meet your immediate and future needs. Here are some savings goals that everyone should have.

Tips for long-term savings.
• Save at home ready to survive the American dream? Start making advance payments, monthly mortgage payments, property taxes and insurance premiums. If you are still renting, find a roommate to save money. Taking a second job is another way to get extra money.

• Save money on your child’s education. It’s never too early to think about your son’s college career. Parents should consider saving money in a special tax account, such as the 529 package.

• Save for the future. Do you have enough money to survive in the 60s, 70s and so on? Make a budget for your own future and prepare a plan that saves you enough money to pay bills, medical expenses and travel.

Short tips to save
• Except for emergency situations. It is very important to maintain the threat status for at least three to six months. Prepare unexpected things by throwing money into a high efficiency savings account.

• Save for more purchases. Are you planning to replace a refrigerator or a new car? Save as much as possible and use the correct premium credit card if you want to start buying.

• Save for vacations everyone deserves a rest. Make sure you have enough money to enjoy your time by eliminating unnecessary costs and placing the money in a separate travel account. If you cannot go too far, staying at night is always an option.

Loans: types of loans we offer and how we understand the area better than an outside loan office

Grand Mountain Bank is the only local bank in Grand County, Colorado. The
headquarters of the company is located in Granby, Colorado, and has FOUR
locations. The Summit County loan office is also located in Frisco.

Grand Mountain Banks understands this area better than outside banks and is
also popular with local residents. We offer a wide range of loans, depending on
your needs; Personal loans and commercial loans.

Commercial loans:
Build your business! We offer small business loans to finance equipment, new
vehicles and buy new supplies.

Commercial credit line:
Pay in difficult times this year or wait for your customers? We offer lines of
credit that will help you survive these times.

Loans for commercial real estate:
Are you building, buying or refinancing your office building? We offer variable
loans or fixed interest rates backed by small commercial real estate.


Personal loans

Home equity loan:
We offer the first trust agreement to finance your own capital to finance
renovations of homes, new cars or dream vacations.

Home construction loan:
Build the house of your dreams in the mountains. We offer short-term loans
with interest payments as pre-financing. Loans are available for individuals or
contractors who meet the requirements.

land loan:
Banks offer loans that are guaranteed in the first trust contract on
undeveloped land for the future home.

Auto loan:
Loans for financing new or used cars or trucks.

Home mortgage loan:
Buy or refinance your home or apartment in Grand Mountain Bank. We offer
secured loans for the first deed of trust with a fixed or fixed interest rate of 10,
15, 20 and 30 years. Primary, secondary or investment real estate.

Overdraft protection:
Protection of credit in the current account due to checks reimbursed due to
insufficient funds

Other consumer loans:

Personal loans are available for a variety of reasons and are guaranteed by
different types of guarantees.

Contact us today at 970.887.1221 or stop by at any of our locations – Grand
County, Fraser, Granby, Grand Lake and Kremmling. Also our loan office in
Frisco – 970.455.8409

Building credit: start rebuilding the loan, what you can do to build your credit

Good Credit, Poor Credit

Getting rid of bad credit information report and processing previous invoices or debt bills is the best way to rebuild bad credit. To increase your credit score to a level high enough to be approved for credit and loan cards and qualify for higher interest rates, you must go beyond the preliminary steps. You must show your new creditors and lenders that you can handle the loan responsibly and not accept new applications once they have been approved. Rebuilding the loan can be difficult, but after getting the boost you will get a good credit rating.

Good Credit, Poor Credit
  1. Start by receiving a new fund account

    If you do not have your credit card due to bad credit, you must buy at least one new account. Many people rely on old credit cards after bad loans; for fear that new credit cards will only make it difficult. However, avoiding credit cards makes it difficult to rebuild your credit. Using the correct credit card will help you get a positive payment history and help you get a better credit score.

    A low credit rating makes it difficult for large banks to accept credit cards. Fortunately, even with bad credit score, you still have several options. Do not apply for too many credit cards at once. Each application has an impact on your credit rating, which makes it difficult to approve other accounts.

    When searching for a new credit card, look for high-risk credit cards that are victims of bad credit. These credit cards often have high interest rates and very high rates, which makes the loan an obstacle. Many people are in debt due to a damaged loan after trying to rebuild with one of these types of credit cards.

    You should also avoid prepaid credit cards as a way to rebuild a bad credit. Even if you have a prepaid credit card regardless of your credit history, you will not be reported to the credit bureaus because they are not credit cards. No matter how responsible you are, using a prepaid card cannot help you keep your balance.

    It is important to handle rejections correctly. If the credit card application is rejected, do not add any additional credit cards. Instead, wait until you receive a letter in the email with the exact reason for the denial. If they reject it, it may not have anything to do with their solvency, but it may be another factor, such as their income.

  2. Change bad credit with good credit

    If, practice really makes it perfect, the next step is to apply good credit habits to practice. Your bad credit will not improve until you prove to your creditors that you possess the qualifications necessary to obtain a good result. This means that only what you can afford is counted, and the bills are paid on time each month. Do not put too many credit cards in this conversion period, as it can be difficult to manage your payments and balances.


  3. Pay everything on time

    Your payment history is the most important factor in rebuilding credit. Even if the payments are not regularly exchanged on the credit report, the payment may eventually end if the payments are delayed. Avoid pre-determined payments on all accounts, including small fines, school meals and medical bills. More and more companies use the services of debt collection agencies to track the accounts of their unpaid customers. If one of your accounts goes into debt collection, it will be reported to the credit agency and will remain on your credit report for seven years. This will damage your progress.


  4. Build a better credit habits

    If you do what you always do, you will get what you always get. To create a new loan, you must replace buying habits with new and better reliable purchases. If not, you will return to the place where you have worked so hard to leave.

    The days are over when you can make up for the things you cannot pay, simply pay the minimum and do not pay with a credit card. The increase in your credit rating means that you will stay well below your credit line and pay your bills with your credit card on time, preferably in full.