Where Did I Put That Down Payment Anyway?

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Near the top of the list of questions that I ask potential borrowers is this one: How much money have you saved for down payment? While there are a couple of options available for those who have no down payment saved, it is always a plus when someone has put money away for an eventual down payment whether they choose to use it or not. (It speaks to a pattern of savings. Savings means there is an ability to deal with unexpected emergencies and that is a very good thing. While technically someone with only $50 in the bank may be qualified for a mortgage loan, I am always uneasy advising someone to move forward with the idea of buying a home with so few assets.

Sometimes I think people have difficulty seeing where they have room in their budget to save money for a down payment. I can see how a young family with a couple of children has a hard time stashing the cash. And I think it is true that sometimes we have difficulty discerning the difference between what is necessary and what is nice. (Even at this late date I have issues with the same.)
So here are a couple of suggestions for those of you who don't quite know where you can economize to find your down payment savings:

Who has cable or satellite tv? Show of hands now...ah yes, quite a few I see.What's the average cost of television for that cable? $79 or $89 per month? Might I suggest this-purchase a Chromecast or Apple TV, an HD antennae-all one time hard costs. Subscribe to Netflix or another streaming service. Bingo! Savings of over $1000 per year. Put that money in your house savings account.

Next up do you buy lunch out every day? At an average cost of $10.00 per day or $50 per week you could save $2600 per year. Again-put that money in the house account. And how about going out for drinks? A very social thing to do, right? Why not consider having friends in for drinks-buy a bartender's guide and have your social ocassion at home. Why? If you spend an average of $66 per week on drinks out that is $3432 per year. Put that in your savings account. Let's see, how much have we saved in one year- $7032. That's more than enough for the down payment on a house.

This does require discipline and planning- and I am not saying NEVER go out for drinks. This is just to illustrate there are ways to save money that you may not have considered. While $15 per week may not seem like a lot, it adds up. So here's to my dancing drinks-get started on that savings account for that new house today!