Jason Buss | Belleville Real Estate, Swansea Real Estate, Freeburg Real Estate, Shiloh Real Estate

It can be difficult to find the extra savings to put towards your first home as a renter. With rent and utility prices rising, most people’s paychecks are leaving them with less and less savings at the end of the month.

Buying your first home, however, can be a great long-term financial decision. It will help you build equity, and, eventually, you’ll be able to use that equity toward another home or toward retiring.

In today’s post, we’ll talk about some of the ways to save for a down payment while renting an apartment.

How much to save

In order to make the most of your first home purchase, you’ll want to save up as much of a down payment as possible. This will help you receive the lowest interest rate and reduce the amount you’ll pay toward interest.

If you can manage to save 20% of the loan, you’ll also be able to waive private mortgage insurance (PMI), that would otherwise set you back around $100 per month or more.

Smart ways to save while renting

If you’re ready to get serious about saving for your first down payment, let’s talk about the best way to approach your savings plan.

Pay off small debts

If you’ve had that lingering credit card debt that you’ve never quite paid off, now is the time. Take a look at your current debts. Pay off the smaller balances first and focus on debt with the highest interest rate.

This will enable you to start making larger deposits toward your down payment savings sooner and can help you avoid needlessly paying interest on small loans and credit card debt.

Open a dedicated account or CD

The best way to make sure you contribute to your down payment savings plan is to open a savings account or take out a CD (certificate of deposit).

A savings account with a high-interest return is a good option for people who are worried that they may need to access their funds before they’re ready to buy a home.

If you’re comfortable with not being able to access your funds until a set date, then a CD could help you save more money.

Since CDs are a one-time payment, many people choose to combine both CDs and high-interest savings accounts to achieve their savings goals.

Regardless of which option you choose, be sure to shop around for the highest interest rate. Online banks tend to have higher rates than traditional banks and are also easy to sign up for.

Direct deposit a portion of your pay

Opening a bank account or CD won’t do you any good if you don’t commit to contributing to it. If you are paid via direct deposit, visit your HR office and ask them to reassign a portion of your weekly pay to your new account.

By following these tips, you’ll be able to better prepare for your down payment. Don’t  wait! The sooner you start saving, the sooner you’ll be able to purchase your first home.

1724 North 16th Street, Swansea, IL 62226  

Total Rooms
Full/Half Baths
This well maintained home is centrally located in Swansea on a corner lot with an asphalt driveway and spare driveway out back. The exterior is maintenance free with a nice back yard, big patio, and cute garden shed. The home has original hardwood floors in the living room and two bedrooms. The vintage kitchen is in great condition but can be easily updated if you wish. The large family room with fireplace makes this home very cozy and great for entertaining. The large open basement has a great workbench with awesome storage and shelving. Roof is approximately 8 years old. All appliances stay and the home is part of an estate being sold AS IS. City Inspection has been completed and home will need to be brought up to city code by the buyer for occupancy. All information including, square footage, lot size, school district, etc. to be verified by buyer.

Buying your first home is probably one of the biggest purchases you’ll make in your life. But, it does come with its advantages. Among them are tax breaks and deductions that you can take advantage of to save money if you play your cards right.

In today’s post, I’m going to cover some of the tax breaks and deductions that first-time homeowners should seek out this tax season to help them lower their tax bill.

Mortgage points

While earning points is a good thing on the basketball court, it can be a financial drain on a mortgage. Mortgage points are what buyers pay to the lender to secure their loan. They’re usually given as percentage points of the total loan amount.

If you pay these points with your closing costs, then they are deductible. Taxpayers who itemize deductions on their IRS Form 1040 can typically deduct all of the points they paid in a year, with the exception of some high-income taxpayers whose itemized deductions are limited.

PMI costs

If you’re one of the many people who made a down payment of less than 20% on your home, odds are that you’re going to be stuck with PMI, or private mortgage insurance, until you pay off at least 20% of the loan balance.

The good news is that homebuyers who purchased their home in the year 2007 and after can deduct their PMI premiums. However, the state on premium insurance deductibles is something that frequently comes up in Congress, so homeowners should ensure that these deductions are still valid when filing their taxes.

Mortgage interest

Mortgage interest accounts for the biggest deduction for the average homeowner. When you receive your Form 1098 from your lender, you can deduct the total amount of interest you’ve paid during the year.

Property taxes

Another deductible that shouldn’t be overlooked by first-time buyers is local property taxes. Save the records for any property taxes you pay so that you can deduct them during tax season.

Home energy tax credits

Some states are offering generous tax credits for homeowners who make home improvements that save energy. There are a number of improvements you might qualify for, including things like insulation and roofs, as well as photovoltaic (PV) solar panels.

IRA Withdrawals

Many first-time buyers withdraw from an IRA account to be able to make a larger down payment on their home or to pay for closing costs. In most other cases, withdrawing from an IRA will count as taxable income. However, if your IRA withdrawal is used toward a down payment or closing costs, the tax penalty is waived.

Keep these tax breaks and deductions in mind this tax season to help you save money and get a larger refund.

This listing recently sold for $157,500.

8420 West State Route 15, Belleville, IL 62223  

Sale Price
Total Rooms
Don't miss this fantastic, very private home sitting on 2.76 acres with a private pond and beautiful scenic views!!! This home features many updates including vinyl plank flooring through most of the main floor, newer ceramic tile, a spacious living room w/wood burning fireplace, updated main bath w/amazing shower heads, very large eat-in kitchen/dining area w/built in's & sliding glass doors leading to a 18x11 brick patio. Master w/large walk-in closet, 2nd bedroom on main floor. The walk out basement features a large wet bar/game room area w/lots of storage, an oversized family room, full bath, laundry area, private office area, & 2 additional spacious rooms. Brick walks lead to a multi-level deck, 21x42 above ground pool w/new liner & new filter system. Pond features a sump pump from nearby creek to maintain pond levels. Garage features a great workshop area w/lots of storage and a new garage door. Property includes approximately 700 ft of highway frontage.

Fantastic opportunity to own one of Belleville's most recognized full-brick historical Victorian home/commercial properties! This home is located very near to the court house, YMCA, and the Bank of Belleville with easy access to parking lot off alley in rear of building. This property is zoned C4 "Heavy Commercial" and is being sold as-is. Home has 15 rooms which includes the two rooms with 8' ceilings on third floor. This building has a large walk-up basement with high ceilings providing ample storage space. First floor features many built-in bookcases, etched windows in foyer and front staircase. You must see this property to appreciate the potential! This could easily be used as a restaurant, office space, great opportunity for a bed and breakfast, retail, salon, cafe, art gallery, the possibilities are endless! Buyer will need to apply for variance if they want to live in home. All information including, square footage, lot size, school district, etc. to be verified by buyer.

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