Finding the Money for Your Downpayment

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In an ideal world you’ll have saved enough money for the downpayment on your home and you’ll be easily approved for your new mortgage. Unfortunately we don’t live in an ideal world and certain circumstances can make you feel like you’ve got no choice but to find a way to raise the funds necessary for your downpayment. Some of these scenarios include:

  • Divorce, especially when children are involved
  • Moving out of parents’ home in an uncomfortable situation
  • Skyrocketing rents that are higher than mortgage payments

Reasons like these and others may inspire you to get creative in finding the money you need to buy your home. The one thing you should never do is take out a big loan. Even if your intentions are honorable, your debt-to-income ratio can be skewed to the point where you’ll be instantly turned down. Here are some other ideas:

  1. Borrow from a family member. Yes, this can be dangerous if you’re concerned about paying it back quickly, but if you have the ability to repay the loan, you’ll probably get it at a very low rate of interest or possibly without interest at all. Some families who have money saved may even gift it to you so you won’t have to pay it back unless you want to.
  2. Cash in your 401(k). Be careful here. Severe penalties and taxes could diminish the total. You may have $30,000 saved, but with penalties and tax payments, it could drop that amount to somewhere around $14,000. Still, dire circumstances call for big sacrifices. This is a personal decision that only you can make.
  3. Take a second job. If you can handle it, the extra money should go straight to your downpayment fund. It’s not easy, but millions of Americans hold down multiple jobs and deposit their paychecks directly into a bank account for their downpayment.
  4. Government programs. Veterans can apply for assistance through VA loans. In some cases you won’t need a downpayment for your mortgage and the rate is usually lower than what is offered by commercial lenders.

Making these hard decisions can require some help. I provide my clients the most sensible options for their unique situations and act like a sounding board to help them make the best decisions.

Buying a home takes time, care and analysis on my part to help you find the best path to secure and pay off your mortgage. Call me at 617-965-1236 to discuss how I can help.

Ready to buy a new home or refinance the one you own? Please get in touch and I’ll be happy to answer your questions and help guide you through the process. I look forward to speaking with you.

Om

Today is National Meditation Day, so let’s take a moment to focus on the benefits of this ancient practice.
Did you know that more than 380 peer-reviewed research studies on transcendental meditation have been published in over 160 scientific journals?
The research shows that meditating regularly has some very specific health benefits.
  1. Reduced cortisol. This is a stress hormone. Meditating can reduce the release of it. The studies found a noticeable reduction of stroke and heart attack in those with coronary diseases compared with people who did not meditate.
  2. Reduced anxiety and depression.
  3. Improved memory and brain function.
  4. Reduced insomnia.
  5. Greater inner calm.
  6. Normalized blood pressure.
To learn more about different types and techniques of meditation, check out this article from the Mayo clinic.

May’s Home Improver: Know Your Ants!

There are many types of ants crawling in yards, trees and homes around the world. Some are harmless and others, like the notorious bulldog ant of Australia, will bite and sting you until you’re dead.

In Massachusetts, we mostly have kindler, gentler ants, but that doesn’t mean they can’t be aggressive and hazardous to your health.

Let’s start with the common little black ant. What’s he doing in your house and why is he traveling with so many friends? He’s probably foraging for food. If you’ve ever seen a long trail of ants heading for your trash bin or trudging towards an errant fruit loop, it’s because they’re hungry. They won’t bite you but they have a sweet tooth, so be careful what you leave around the house.

Next, we have the flying ant, also called the swarmer. Mostly harmless, but menacing. I hate these things! Who thought it was a cool idea to give ants wings? I suppose its better than a flying rat, but aren’t those just bats?

OK, time for some next-level ant toughness. The carpenter ant. Now don’t expect them to make you a bookshelf. Their name implies that they’re workers, but they can be quite destructive. Carpenter ants
enjoy infesting wood that’s been weakened by moisture. Some people mistake their them for termites when they gather during mating season. But carpenter ants don’t actually eat wood like termites. Instead, they destroy wood by burrowing down into it and building nests. Fun!

Finally we have the fire ant. Stay away from these freaks! The good news is they’ll probably avoid coming into your home. But if their nest is upset in the yard, they get mean. They have no problem racing after you and stinging you (yes, they both bite and sting). The stings are very painful and can be dangerous for people and pets with certain allergies. Lucky for us, these fire ants aren’t the same as the venomous South American fire ant, which has made its way to Australia and causes millions of dollars in damage every year.