Buying a home in a hot market typically means that the prices will be high. Even if you are prepared for a high mortgage and have enough income to make the payment, going from a four-digit rental amount to a five digit mortgage can seem like a major leap. In order to successfully make the transition, you will need to prepare yourself mentally and financially. Here are a few ways to make the leap to a five-digit monthly mortgage payment for the first time.
Split the payment between all of your paychecks
Even if you have enough money from one paycheck to cover the monthly mortgage, it can be easier to split the payment up between all of your monthly paychecks. If you get paid twice a month, you should take half of the mortgage amount out of each check, then send the check-in by the due date. If you are splitting the cost between yourself and your spouse, you can choose whether to take a portion out of each of your paychecks once or dip into each of your monthly payments several times for the amount.
Keep a five-digit mortgage savings
If you have never had a bill as large as a mortgage in the ten-thousands per month, you will feel more comfortable with a little bit of cushion for planning. Create a mortgage savings that you will use to cover the mortgage in times of hardship only. This will give you some ease knowing that you have a small nest egg for the mortgage should anything happen to your income for a little while. It will also prove to you that savings a five-digit sum while paying your regular bills is something that you can accomplish.
Start automated savings programs
If you find it challenging or stressful to go over your bills each month and allocate money towards savings, you should try some automated savings accounts. There are applications that will save money automatically depending on the amount of your paycheck and the regular amount that you spend. There are also programs that will look for savings based on your receipts and purchases, which will provide you with extra money to put into savings You can also select a regular amount and have it automatically transferred from a checking to a savings account on a certain day of the month. If you start an automatic savings plan, you will be able to transition into saving a little bit more without combing over your budget and fretting over your new, higher bills.
To learn more, contact a credit union like Rio Grande Credit Union.