How To Save Money For a House

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How to Save Money for a house

Want to know how to save money when buying a house? We’ve got some ideas for you! From consolidating your shopping trips to sharing closing costs, these tips will help you keep more money in your pocket when you buy your home.  

Some of these may seem counterintuitive (wait, like, I should spend money on an inspector?), but I promise they’ll benefit you in the long run.

Without further ado, here are 14 ways to save money when shopping for a new home.

How to Save Money For a House

1. Decide What You Want

Make your choices. List your needs and wants, negotiables and non-negotiables, when it comes to buying a house. Then, don’t waste a minute looking at anything else. And don’t budge! 

This list of wants and needs might include “less than a 25-minute drive to work” or “3 bedrooms or more.”  You know what you and your family need the most.

Does this mean you can’t change your mind? No, you can always adjust the scales. But by sticking to your guns, you’ll avoid the things you don’t need and focus on everything you do.

2. Shop Neighborhoods From Your Couch

An online map lets you learn a lot about a home or neighborhood. Have the little Google man walk around for you so that you don’t waste time and fuel driving around towns.  This way, you’ll know ahead of time if there’s something like a busy intersection around the corner, a power plant two doors away, or even something good like a bakery two doors down.

3. Scour Listing Photos

You can learn a great deal about a home by stealthily inspecting its listing photos. Look for things like dated electric outlets, heating sources, mold, potential repairs; the list goes on. When buying our foreclosure home, we knew before we saw it in person that it would need work. 

Sometimes, you can even tell if a photo has been doctored, stretched, or enhanced. If you decide it’s not your house, pitch it and move on!

4. Consolidate Your Home Shopping Days

Particularly if you live far away from your new home’s destination, you can save money by shopping for houses in clusters. We lived in Queens while shopping for a house in Jersey. Whether we drove or took the train, tolls and train fares cost a small fortune for two adults to commute.

Take a full day or weekend to view neighborhoods and homes in bulk.

5. Drive Around a Prospective Neighborhood

Once you are ready to consolidate your shopping days, schedule a “drive-by” day without a realtor.  Make a list of houses you want to see, then drive by all of them. You can probably cut your list down very quickly.

You may not have initially noticed something geographically undesirable, like a train station next door or a sewage plant across the street. Or maybe the pictures looked amazing but conveniently didn’t show that the house isn’t standing up straight (yes, this exists!).

Regardless of the turn-off, trust me on this: I promise you’ll know the second you look at a house if it’s not for you. Trust your gut, and don’t buy that house.

6. Organize Your Money

Get your financial ducks in a row. A better credit score means a better mortgage rate. A higher down payment means a smaller mortgage. Furthermore, with an airtight financial presentation, you’ll get preapproved for a loan faster – and time is money when bidding on a house!

7. Make the Ask

Check if the seller will contribute to closing costs. Hey, you never know until you try!    

8. Explore All Possible Costs

Look at fees besides the monthly mortgage payment. When shopping for a house, particularly for the first time, it’s easy to look at principal + interest costs as provided by a listing website. If the principal, interest, taxes, and insurance (PITI) look like they will be less than your monthly rent, buying a home is tempting!

But have you considered property taxes, HOAs, and utilities? What about the costs of trash and recycling pickup, if applicable? Or consider everyone’s favorite duo – maintenance and repairs? By foreseeing potential “extras,” you could save yourself a lot of money in the future.

9. Understand PMI

PMI is private mortgage insurance. No, it doesn’t insure you – it insures the bank in case you don’t pay. If you make a down payment of less than 20%, you’ll have the cost of PMI on top of your mortgage, interest, and taxes. It’s not cute! Avoid it if you can!

10. Educate Yourself

Don’t pay for investing courses, classes, seminars, or coaches… YET.

There is an OCEAN of information out there on buying houses. Start with your local library and read up on investing strategies that will work for you. Read all the blogs!  Follow the investors you admire on social media. Use your best judgment to decide what philosophies you want to adapt and which you want to ditch.

I would be shocked if you exhaust all the free avenues of information necessary before you get your first house.

11. Use an Experienced Agent

Now is not the time for an agent’s first real estate deal. An experienced agent should guide you through the home-buying process more efficiently. Get recommendations from family, friends, and coworkers.

Are you hoping to support your cousin’s bestie’s sister, who just got their real estate license?  Well, maybe they can work with an experienced agent as an assistant. But don’t sacrifice your home purchase in the name of being nice. This is a big deal with a lot of money on the line.

12. Pay For Quality, Once

Skipping things like a title search or home inspection might seem like they’re saving you money upfront. But if you miss a huge problem, you’ll pay exponentially more for it down the road, so don’t skimp on them.

For example, let’s say you skip the inspection and don’t know that there’s a little mold in one duct. It spreads, and instead of paying $500 for an inspector and $5 for a bottle of Lysol, you’re paying $4,000 for mold abatement professionals to fix the whole basement.

13. Remember a Contingency

If you’re buying a home that needs work, carefully estimate your repair costs and create a home renovation budget.

Then – and here’s the important part – add 10-15%!

There’s nothing wrong with a foreclosure or fixer-upper – in fact, we tackled a two-for-one in that regard. It was financially a great decision, but know that we were very intentional when bidding and renovating.

A contingency fund is imperative, even more so with an older home or foreclosure.  

14. Cash Is King

Have cash at the ready in a high-yield savings account. Cash always helps. Cash, cash, cash. The Benjamins. The coins. As my immigrant Irish grandma would say, “‘Tis better to be looking at it than for it.” So, save up!

There you go – 14 ways to save when you’re buying a home. From consolidating your shopping trips and organizing your money to planning a contingency fund and keeping cash, you will be a savvy house shopper in no time!

This article originally appeared on Wealth of Geeks


Noreen is the creator ofOur Two Family, a real estate blog helping homeowners renovate with ease and house hack with grace.  She and her husband Derek have owned their two family fixer upper since 2016, renovating it from top to bottom and house hacking along the way.  By day, Noreen is a top NYC hand model, while Derek is an expert CAD drafter in engineering.  Together they like to dream about their next investment, take epic walks through their neighborhood, and raise their two beautiful children.