Real Estate, Tips & More

How to Save to Buy a House

Depending on the type of loan you are applying for, you may need from 3% to 20% of the purchase price for a down payment. In addition to your down payment, you will also need around 2%-5% of the purchase price for closing costs. Once you know how much you can afford, you will be able to determine the amount you will need and how long it will take to achieve your goal. Here are some things you can do to achieve this goal:

1. Open a bank account that is specifically for saving money for your home purchase. This can be a savings or investment account. Set it so the transfer is done automatically every month and, no matter what, do not withdraw any money from that account.

2. You may also deposit any tax refund, extra money, or gifted money into the new account.

3. Reduce any current debt. Start by paying off any high-interest credit cards.

4. Do not get into any new debt whether it is a new credit card, a loan or a new car.

5. Cut down unnecessary expenses such as entertainment, eating out, and non-essentials.

In addition to this, you may also start a new side job and save this income. However, keep in mind it is recommended that before you start saving for your new home, you have an emergency fund already in place with at least three months of your monthly expenses. This will allow you to have a separate account in case of an emergency so you do not need to tap into your home purchase savings.

Featured image by Jeremy Bishop / Unsplash.com

Content image by Eskay Lim / Unsplash.com

Tips & More

Every Homeowner Should Know About These Four Forms

As a homeowner, you should know about these four forms regarding protection of your primary residence and possible reduction of property taxes.

PROTECTION

1. Home Protection for Seniors, Severely Disabled, Families and Victim’s and of Wildfires or Natural Disasters Act – lf you are 55 or older, you have sold your primary residence, and are occupying your replacement primary residence, you may file form BOE-60-AH, Claim of Person(s) at Least 55 Years of Age for Transfer of Base Year Value to Replacement Dwelling, it gets filed with the County Clerk’s Recorder’s Office where the replacement property is located. More information may be found in the California State Board of Equalization information page.

2. Homestead Declaration – This form serves as a protection on your primary residence in the event certain creditors want to force a sale to satisfy a court judgment. There is a designated amount that protects the property equity. You should seek legal advice to ensure the form is completed properly. The notarized Declaration of Homestead form is filed with the County Clerk Recorder’s Office where the property is located.

PROPERTY TAXES

3. Property Tax Exemption – The State of California allows an exemption of up to $7,000 on the value to assess the tax of your primary residence. The claim form, BOE-266, Claim for Homeowners’ Property Tax Exemption can be provided by the County Assessor’s Office and you file it with the County Clerk Recorder’s Office where the property is located. More information may be found in the California State Board of Equalization Property Tax Exemption page

4. Notice of Supplemental Assessment – The County Assessor of the county where the property is located will assess the property value to determine the tax on the property value. You do not need to file anything for this but if you had new construction or if you just bought a property, you should expect this notice. Depending on whether the value went up or down, you will get a bill or a refund. More information may be found in the California State Board of Equalization Q&A page.

These forms are publicly available at your local County Assessor’s Office. They may be able to answer general questions but it is important that you seek legal advice if you have questions about how these forms may or may not benefit you.

Photos from Unsplash by:

Kostiantyn Li

Tingey Injury Law Firm

Samia Liamani

Marissa Grootes

Blake Wheeler