house down payment - how did you do it?

[LivingAlmostLarge]

How did you guys save for your first house down payment? How long did it take? Was it hard? We needed around $20k to buy our first place and we had fortunately saved it through college and working and DH and I both split $10k each. That was a lot of money in 2002 considering we had just both finished college in 2000 and he was in grad school. That was pretty much all his money left from taking a sabbatical from undergrad and working and he still had a loan on his car. I was working and that was what I had saved in 18 months of work after paying off my $10k in student loans and living together. Pennies I saved all my dollars literally. Back then eating out was $7 split a week and a free movie rental date night both before and after.

I would say it took us years like 4 years to save $20k between the two of us and lot of it was luck for DH investing and then cashing out before the 2000 tech bubble, then sticking it in savings and $5k on his car. He had around $10k left for our home. I had $5k in a MF i had been saving in college and just scraped the rest. If I'm not mistaken we might have even gotten a 0% CC loan for some, we definitely bought our washer/dryer on Best Buy 24 month 0% financing and literally needed that for breathing room in our budget.

I was just thinking I gave someone the advice to buy small and roll up equity. It literally has allowed us to buy our current house and all future homes without ever saving again. Sounds ridiculous but the best decision we ever made was to save that 10% down payment $15k and $5k closing costs (maybe a bit less). So it was way easier even though well at the time it was like 50% of our income $40k (that's about what we made gross)

[kork13]

It took me about 2 years of living on ~50% of my relatively generous income. I was young, single, and living overseas, with not nearly enough friends or hobbies. So I paid off the last loan I brought out of college, and saved up ~$60k. I returned from Japan, bought a new car, and put 25% down on my first house.

I got married a couple years later, and with our combined incomes, we saved up enough for a 20% DP on our next house (more than double the cost of the first...HCOLA sucks), while keeping my house as a rental. We paid off the mortgage on the rental a couple years later.

We built up our equity over 3.5 years in house #2. By continuing to aggressively save/invest, and scraping all of the nickels from the couch, we were able to sell house #2 to buy house #3 in cash. Such an incredible feeling to have no mortgage....

We had the benefit of 2 very healthy incomes & relatively controlled expenses (living on 40-60% of our combined income). Always using only 15yr fixed mortgages, >20% DP, and frequent extra principle payments helped us build equity fast. Overall, I went from no house & maybe $20k in savings to two paid off homes over the course of about 10 years. Even though DW was forced to leave her job for medical reasons, we had done enough focused work along the way to make the loss of her income a mere inconvenience.

[jenn_jenn]

We used a VA loan with 0% down for our house. There’s usually a funding fee but ours was waived because of my husband’s disability rating. We still spent about $50k on closing costs and some minor repairs that needed to be done before we moved in. That was a combo of just our regular savings, a bonus my husband received, and my parents gifting us $10k. We didn’t need the money from my parents but it was very nice of them to do.

Less than a year later we purchased a condo with a 25% down payment using a regular mortgage. We just pulled it from our savings account.

We never specifically saved for a down payment and looking back I don’t know why. We were really lucky with how everything worked out.

[disneysteve]

Our down payment was $28,400 (20%). DW and I put up $18,400 and my mother gifted us $10,000.

[james.hendrickson]

How did you guys save for your first house down payment? How long did it take? Was it hard? We needed around $20k to buy our first place and we had fortunately saved it through college and working and DH and I both split $10k each. That was a lot of money in 2002 considering we had just both finished college in 2000 and he was in grad school. That was pretty much all his money left from taking a sabbatical from undergrad and working and he still had a loan on his car. I was working and that was what I had saved in 18 months of work after paying off my $10k in student loans and living together. Pennies I saved all my dollars literally. Back then eating out was $7 split a week and a free movie rental date night both before and after.

All, I just wanted to weigh in here. LivingAlmostLarge is correct. I don't think there are really any quick fixes to raising the down payment money. You just need to work at saving, hustling extra cash to add to your savings, and reallocating some of your investing money.

[bjl584]

It took me about 4 years to save up the 20% down payment for my first home.
It was around $20K, but I wasn't earning much at the time.

I was saving in my 401K up to the match, and all extra money was put into savings.

Pretty simple approach.
All it took was discipline and patience.

[LivingAlmostLarge]

It took me about 4 years to save up the 20% down payment for my first home.
It was around $20K, but I wasn't earning much at the time.

I was saving in my 401K up to the match, and all extra money was put into savings.

Pretty simple approach.
All it took was discipline and patience.

Did you consider putting down less? Or buying a cheaper place to get into it faster? Did you live at home? Or have to rent? For us getting into a house faster made the biggeest difference because rent would have ruined us. If we didn't buy in 2002 i bet we couldn't have bought until 2006/2007 and maybe it would have been good with the crash. But then we were making more and we would have had to save more for longer than less on less.

[myrdale]

I was in a cheap apartment for a year, paid off the remaining $7k or so I owed on the truck, and then saved $13k.

I applied for an FHA loan. I put down $7k on $108k, so about 6.8%. It then took me an additional 9 years to pay it off.

[james.hendrickson]

I was in a cheap apartment for a year, paid off the remaining $7k or so I owed on the truck, and then saved $13k.

I applied for an FHA loan. I put down $7k on $108k, so about 6.8%. It then took me an additional 9 years to pay it off.

Myrdale, did you go pretty hard on paying the loan off?

[Jluke]

Did you consider putting down less? Or buying a cheaper place to get into it faster? Did you live at home? Or have to rent? For us getting into a house faster made the biggeest difference because rent would have ruined us. If we didn't buy in 2002 i bet we couldn't have bought until 2006/2007 and maybe it would have been good with the crash. But then we were making more and we would have had to save more for longer than less on less.

not BJL, but Pennsylvania real estate is nothing like California.

[Jluke]

I moved back in with my parents a year after renting (after college). Lived there too long but easily saved about $120k in 4 years for a 60k downpayment. And paid off 18k in student loans and two car loans as well.

it was worth the lifestyle but definitely not for everyone to go that route.

[ua_guy]

First house...we didn't. We had a 5/1 ARM and a 20% HELOC for the down payment. 23 years old and living on the edge...

[james.hendrickson]

First house...we didn't. We had a 5/1 ARM and a 20% HELOC for the down payment. 23 years old and living on the edge...

You guys didn't hustle side money or extra cash for your savings or anything like that?

[ua_guy]

You guys didn't hustle side money or extra cash for your savings or anything like that?

We had some cash saved for emergencies and we saved minimally in retirement - enough to get a matching contribution.

[Fishindude77]

Rented a house and lived cheap.
Took a couple years to save up a down payment, I think around $5k. Our first home was only $25k, but that was still substantial considering our income at the time.