Planning your budget
Decide what your long term financial goals are.
Often, you may have multiple goals, such as saving for retirement, buying a second car, buying a home, and saving for your children’s college fund, so identify which is most important to start working toward first.
Make a savings plan for buying a home.
Open an account just for this purpose and put aside money regularly, even if it is as little as $10 a week.
Make a list of your monthly income, savings, and spending.
If you find you currently have a lot of credit card debt at a high interest rate, transfer your balances to a low interest card, and then spend at least a year paying off as much unsecured debt as possible.
If you are going to start on your search for the perfect home right away, and you are short on up-front cash, you may have a few unexplored alternatives.
First time homebuyers have access to $10,000 of their IRA funds penalty free under certain conditions.
Cut back on your “extra” spending, such as eating out and going to the movies for a few months.
Ask relatives if they would be willing to cosign a loan or grant you a short-term personal loan for your down payment.
Sell or borrow against real estate, securities, collectibles, secondary automobiles, or other “extras” you own.
Look for loan programs like VA or FHA that ask for little or nothing down.
Look for a rent to own lease, or an assumable loan on your prospective new home.
Cash in or borrow against the value of your life insurance policy, or retirement funds.
Ask for help from your church, synagogue, or nonprofit organization such as Fannie Mae.
Get a second job.
Change your withholding taxes.
Refinance your car or other vehicles.
Offer services or property instead of cash to the seller.
Look for foreclosure properties that require little or no down payment.
Attached housing is often appealing to first time buyers because it may provide rental income in the future, and it is also usually considerably cheaper than single-family homes. However, there are some drawbacks that should be considered. Carefully weigh the option of purchasing a condominium, townhouse, or coop.