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Acquiring the ‘Down Payment’

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With the changes in the rules for ‘down payment’ for your mortgage,  saving 20% for a down payment can seem daunting indeed.  As with most purchases in your life, you can make things more manageable for yourself by creating a budget.  Once you’ve properly structured your finances and can see your plan and progress on paper, you will be more likely to stick to your goals and less likely to overspend.

Among the major new rules is a requirement to stress test uninsured borrowers. Previously, only insured borrowers had to undergo such a test. By law, borrowers with a down payment of under 20 per cent for a home must purchase mortgage insurance.  Click here to review a complete article published by CBC, on the new changes.

So to get started, you will fist need to calculate how much you need for your down payment and then open a specific account for  “home savings”.  In this way, you can keep those funds separate from your main bank account.  Your next step will be to make a list of your monthly ‘necessary’ expenses.  Now is time to tighten your belt and either pare-down or totally eliminate those things you purchase each month that is not necessary for your day to day life.  An example might be …. Brew your own coffee at home and eliminate trips to Tim Hortons.  You will be amazed at how much money you can save by going through this type of scrutiny to your spending. Below you will find a few ideas that’ll help you reach your goal:

  1. Consolidate Debts – If you carry a credit card(s) balance, consolidate to a line of credit that offers a lower interest rate.  Now, lock away or destroy those credit cards so that you are not tempted to use them.
  2. Pack It!  – Buying lunch even a few times a week costs thousands of dollars a year!  Try to bring your own coffee in a to-go cup and pack a homemade lunch.  Typically it’s healthier too!
  3. Make A List– You’ll be less likely to order take out or waste money at the corner shop if you pre-plan weekly menus and buy ahead.  Cut out savings-coupons and when possible, buy in bulk as this will also help reduce your grocery bills.
  4. Dim it Down – Shut off appliances when they’re not in use, turn down your thermostat a few degrees and switch off the lights when you leave a room.  Unplug appliances and machines that you are not using as many still draw on electricity, even when they are not being used.
  5. Picture It – Visually (in your mind) dream about your new home.  Be specific … the more vividly  you can dream the stronger your commitment.  Tape a picture of your dream home in a prominent place … this picture right next to your financial goals.  You will find that visualization combined with good old-fashioned willpower will help turn your dreams into reality.

For the most part here in the Southern Georgian Bay area, in the summer our real estate prices started to moderate back to our ‘normal’ again (especially for properties under $500,000) so are reasonably affordable, making it a great time to purchase a home!

As life-long residents, Chad and Scott are  so familiar with this area as well as our brisk market.  They would be honored to be your local market specialist and can best assist you with your specific needs. Contact them – Chad (705-423-9444 or    or  Scott (705-446-6602 .  The Campbell Team would feel privileged to help make your Wasaga Dream come true.