3 Reasons Not To Deplete Your Savings Account When Buying A Home

Posted on: 23 September 2019

You have narrowed down your choices and settled on the house that you are fairly certain will be the perfect place for you to raise your family. You have even started working with a real estate lender to get a loan for the home you want, and you have an attractive amount of money in savings to use as a down payment. You are stoked to find out that the required down payment is far less than what you have in savings.

Should you go ahead and allocate all of your savings funds toward the new home to keep your payment low? It is actually a better idea to save some of the money instead and not deplete your savings account completely. 

You may need the money for additional loan costs. 

There are other fees and charges that can come along with obtaining a mortgage loan other than just the down payment. Some of the things you may have to pay for include: 

  • Fees associated with having the home inspected 
  • Costs related to getting the property transferred into your name 
  • Charges associated with closing the loan 

While some of these costs can be figured in with your loan amount, it is far better if you can pay for some of them out of pocket. 

Moving can cost far more than you assume. 

Once you have all of the loan-related costs out of the way, you will be faced with the process of moving in. Moving from one place to the next is not an inexpensive thing. Not only are you faced with paying the costs of renting a moving truck and buying packing supplies, but you may also be facing other things as well, such as having to take time off of work to get moved or paying for deposits on new utility services. 

You never know what a home may need once you move in. 

You can tell a lot about what a home needs just by looking at it and having it professionally inspected, but there is nothing comparable to actually living in a house when it comes to seeing what it needs. For instance, you may only discover after you move in and live in a place that the kitchen sink doesn't drain after doing dishes or that the heater kicks off when the temperature dips at night and the system works too hard. It is far better if you have a little money in savings to cover these problems after you move. 

For more tips on purchasing your new home, work with a real estate lender