Did you know that your local credit union online banking tools can help you save for a down payment on a new home? There are lots of benefits available when you join St Anne Credit Union and open up a Share Savings account in New Bedford. Beyond the basic options that you can get by becoming a member, there are helpful tools, credit union representatives, and opportunities that you can use to your advantage. However, before you start saving you should set some goals to help you stay on track.
How Much Do You Need?
The first step is to determine how much money you need to save at the local credit union in New Bedford before you can go out and buy a new home. The standard down payment for a home in Massachusetts is 20 percent. However, you can buy a home by putting down more or less, depending on the overall cost and your unique situation. There are pros and cons to putting a lower down payment on your new home. For example, a smaller down payment will typically require the purchase of mortgage insurance. A larger down payment means that your monthly payment will be considerably less than if you were to finance more of the full price. Your local Share Savings account in New Bedford can be used to save money to put down on a new home, but there are other savings options available as well.
Some of the options for low down payment financing include:
- FHA Loans through the Federal Housing Administration, which offers 3.5 percent down payment options; must find a participating lender
- GSE Loans through Fannie Mae and Freddie Mac, which back loan-to-value loans of up to 97 percent; meaning you only need to have 3 percent for the down payment
- USDA Loans for both rural and suburban homes through the U.S. Department of Agriculture; in some cases low rates and 100 percent financing are available
- VA Loans through the Veterans Administration for military veterans and active duty service members; many times requires no down payment or mortgage insurance
Take a look at the average cost for homes in the size and location that you need in your area to determine the “going rate” for local real estate. Then figure out how much you need to save for a down payment, based on the amount that you are willing to spend. So, for example, a $300,000 home would mean that you would need at least $10,500 for an FHA loan or $9,000 for a GSE loan. If you don’t plan on using any of these loan programs, you should save at least $60,000 to put 20 percent down on that same $300,000 home. Speak with your local representative at St Anne Credit Union in New Bedford to find out about home loans through your local credit union.
Increase Your Savings
Whether you need to save $10,000 or $60,000 for a new home loan, make sure that you are doing everything you can to put away as much money as possible. Ask about other savings programs in addition to the basic Share Savings account in New Bedford. When you join St Anne Credit Union, you gain the ability to apply for a broad range of savings programs, including the basic Share Shavings, money market accounts, certificates of deposit, and other increased interest savings plans. This can help you grow your money even faster in addition to the tips for saving money that are listed below.
Some of the best ways to increase your savings include:
- Raises & Bonuses – If you get a raise or a bonus at work, put the extra money into savings instead of pouring it into your monthly budget.
- Tax Refunds – If you get a refund from your yearly taxes, put the whole thing directly into your down payment savings fund.
- Auto-Transfers – Speak with a representative when you join St Anne Credit Union about scheduled automatic transfers to your Share Savings account in New Bedford.
- Car Loan Savings – Did you just pay off your vehicle? Take the money that you were spending on your monthly car payments (or another type of bill) and put it in savings.
- Savings as a “Bill” – When you sit down to do your monthly bills include a specific amount of money for savings as a “bill” just like electricity, gas or cable.
Visit St Anne Credit Union in New Bedford
As you develop a plan for saving money to use as a down payment on a new home, make sure to visit St Anne Credit Union and learn all you can learn about tools and ways to save. Take advantage of credit union online banking tools and make saving money a regular habit. Give us a call at 508-993-0011 to learn more about how to join St Anne Credit Union.