How to Save
The reality is that in order to save, it all depends on how the money is being placed into other factors. That all really depends for each buyer, but it should come down to asking if the money being spent at the moment truly needed or can it be saved for the down payments and rent of the house (if the house is rented).
In some cases, depending on how they saved up with their other expenses, they can save up to 5% of down payments. Other cases, the savings aren’t as efficient and some would request housing loans from the FHA, or Federal Housing Authority to help with their housing expenses. The minimum percentage for the request would be 3.5%. However, not everyone can reach 20% in their down payments and given the status of the market today, it doesn’t really matter.
10% is enough for today’s standards in the market.
Many real estate professionals also take note that as long as there are any fiscal responsibilities for the buyer in their homes and are perfectly comfortable with the PMI (private mortgage insurance), then that 3% isn’t too effective in their overall budgeting. Of course, it all depends on the buyer and their needs.
The 30% rule also holds to today when it comes to the monthly income towards the monthly mortgage payments. It’s something that many homeowners seem to accept in the long run of things.
Rana Khanjani, MBA
San Fernando Valley Iranian-American Real Estate Agent
Providing Services in English and Farsi
Address: 22020 Clarendon St. 200, Woodland Hills, CA 91367