Lynne Eliopoulos
ERA Key Realty Services | 508-832-1032 | [email protected]


Posted by Lynne Eliopoulos on 6/16/2019

Buying a home is a big financial endeavor that takes planning and saving. Aside from a down payment, hopeful homeowners will also need to save for closing costs and moving expenses.

When it comes to the down payment amount you’ll need to save, many of us have often heard 20%, the magic number. However, there are a number of different types of mortgages that have different down payment requirements.

To complicate matters, mortgages vary somewhat between lenders and can change over time, with the ebb and flow of the housing market.

So, the best way to approach the process of saving for a down payment is to think about your needs in a home, and reach out to lenders to start comparing rates.

However, there are a few constants when it comes to down payments that are worth considering when shopping for a mortgage.

In today’s post, we’re going to talk about some characteristics of down payments, discuss where the 20% number comes from, and give you some tips on finding the best mortgage for you.

Do I need 20% saved for a down payment?

With the median home prices in America sitting around $200,000 and many areas averaging much higher, it may seem like 20% is an unattainable savings goal.

The good news is that many Americans hoping to buy their first home have several options that don’t involve savings $40,000 or more.

So, where does that number come from?

Most mortgage lenders will want to be sure that lending to would be a smart investment. In other words, they want to know that they’ll earn back the amount they lend you plus interest. They determine how risky it is to lend to you by considering a number of factors.

First and foremost is your credit score. Lenders want to see that you’re paying your bills on time and aren’t overwhelmed by debt. Second, they will ask you for verification of your income to determine how much you can realistically hope to pay each month. And, finally, they’ll consider the amount you’re putting down.

If you have less than 20% of the mortgage amount saved for your down payment, you’ll have to pay for private mortgage insurance (PMI). This is an extra fee must be paid in addition to your interest each month.

First-time buyers rarely put 20% or more down

Thanks to FHA loans guaranteed by the federal government, as well as other loan assistance programs like USDA loans and mortgages insured by the Department of Veterans Affairs, buying a home is usually within reach even if you don’t have several thousands saved.

On average, first-time buyers put closer to 6% down on their mortgage. However, they will have to pay PMI until they’ve paid off 20% of their home.


So, if you’re hoping to buy a home in the near future, saving should be a priority. But, don’t worry too much if you don’t think you can save the full 20% in advance.




Categories: Buying a Home   down payment   saving  


Posted by Lynne Eliopoulos on 2/3/2019

A good number of families faced the option of living on a single income for several reasons. It could be due to health challenges, work layoffs, the need for a stay-at-home parent, or an agreement to live on one income for the greater good. Whatever the reason may be, families living on one income always find it challenging. Of course, it is not the best option, but it is the reality of a good number of families out there. 

If you belong to one of such families, then grab a sit as I take you through some practical tips that will help you live well while living less.

  1. Draft a Practical Budget. To optimize the little cash available to the family, you must draft a realistic budget. I say realistic because most families go overboard while writing budgets and end up struggling to stick with it. Your budget should be practical. It should be one that allows you to live well while living less. Be sure to estimate your monthly income before allocating cash to each item on the budget.
  2. Know the Difference between Needs and Wants. A recurring mistake seen in most families is trying to live above their means. Why spend thousands of dollars on a car when you can get a cheaper one? Lose the habit of spending heavily on designer clothes, shoes, and accessories. You can get those stuff at a decent price. Go for things within your budget and learn to the difference between your needs and wants. There is a huge difference!
  3. Chase Junks Out of Your Home! I wish I can emphasize this enough. Junk takes up a substantial part of your income and leaves you with nothing but another pile of trinkets. And by junk, I mean everything that is of little or no importance such as trendy clothes (they go out of fashion before you know it), junk food (of course, you don't need them. They are not healthy after all), etc. Why get a new dress just because it will look cute on you? What about the dresses at home, don't they look cute? Resist frivolous spending. Instead, spend on things that have value to you and your family.
  4. Don’t Spend the Left Over. Learn to save!Families who stick with their budgets find that they usually have a few bucks left at the end of the month. While that is ‘worth celebrating,’ it is, in fact, an avenue to save. As a single-income family, you should always be on the lookout for means to save some extra cash. It could be from using coupons, getting a side gig, monthly leftovers, etc. Whatever the source of the ‘free money’ may be, it is no excuse to spend it all. No, save it instead!
  5. Being Self-Sufficient is the Way to Go! An excellent way to live well while living less is to become self-sufficient. Pick up some DIY skills. Learn to make home-made products and food recipes. A garden will help too. Ditch commercial products and stores. Learn to do it yourself!
  6. Try Investing! Cutting back on expenses and saving ‘free money' are great ideas but that is not all you need. Saving means having a little extra cash readily available when you need it but investing, on the other hand, means having more money (than you saved or earned) on hand when you need it. Start investing today!

If you're saving up to buy a new home, talk to your real estate professional about ways to save on down payments.




Tags: budgeting   down payment   family  
Categories: budgeting   down payment   Family  


Posted by Lynne Eliopoulos on 12/30/2018

Buying a home will likely be one of the largest financial decisions you will make in your lifetime. While this may seem scary at first, it’s worth noting that buying a home can also be a valuable financial investment.

When it comes to preparing to buy a home, many people just wait until they run out of room in their apartment before deciding that they need to upgrade to a home. A better approach, however, would be to start planning for your first home a year or more in advance.

Saving for a down payment is a vital step to making the best long-term financial decision. A larger down payment can help you pay off your home sooner, pay thousands or tens of thousands less in interest, and start using your home equity as an asset.

But, saving for a down payment is easier said than done. So, in this post, we’re going to talk about some of the ways you can aggressively save for a down payment so that, when the time comes, you can achieve long-term financial security from your investment.

Setting your savings goals

The first thing you should be thinking about when saving for a down payment is what your goals are in a home. Setting realistic goals in this phase will make saving for your down payment more feasible and less discouraging.

Think about what you really need from a home at this point in your life and compromise where you can.

Remember that on top of your monthly mortgage payments, you’ll likely also be paying for taxes, insurance, utilities, homeowners association fees, and more.

Save on a timeline

When setting your savings goal, make sure you’re aware of the timeframe you’re working with. If you want to buy a home next year, you’ll need to focus on short-term savings options. However, if you’re okay with renting for the next 5 years, investing your money could be a better option.

Lock away your savings

Treat your down payment savings like an emergency fund. Open a separate account, automatically deposit a portion of your pay into the account, and never withdraw from it. To do this, you will, of course, need to already have an emergency fund with a month’s expenses in it.

However, once you’ve established your emergency fund, start immediately depositing into your savings account.

Pay off credit cards

It may seem like saving for a down payment is more pressing than paying off old debt. However, the numbers will show that making interest payments on your credit cards is essentially throwing away money that could have been used toward your down payment savings.

Adjust your spending habits

While it isn’t easy to start spending less once you’ve built a standard of living, there are ways to spend less money and still lead a fulfilling life. Think about where your money goes each month, including bills and services you might pay for.

Now could be the best time to cut the cord and start using a service like Hulu to save $50 or more each month.

Time for a raise?

If it’s been some time since your last pay raise, now could be an ideal time to speak with your employer. To improve your chances of success, don’t discuss reasons outside of work that might be influencing your decision to ask for a raise (such as saving for a down payment). Rather, back up your request with evidence of your accomplishments at work.