How to save for a down payment faster

Your down payment depends on the loan program and the price range you're shopping in. VA allows 0% down for eligible borrowers. HomeReady and HomePossible start at 3%, FHA at 3.5%, and Jumbo loans typically require more. Plan for closing-related costs too, like prepaid interest, escrow deposits and your first year of homeowners insurance.

Saving $750 a month adds up to $18,000 in two years. That's 5% down on a $360,000 home. This is an example only and doesn't include interest earned or other costs.

• Set up an automatic transfer to savings on payday.
• Keep your down payment fund in a separate account so it's not mixed with spending money.
• Look for a high-yield savings account to earn more on your balance.
• Send raises, bonuses and tax refunds straight to savings.

One large change can do more than many small ones. Think about your rent, your car payment, or subscriptions and memberships you rarely use. Even a temporary change, like a cheaper apartment or a roommate for a year, can speed things up.

High-interest card debt makes saving harder and can raise your debt-to-income ratio. Paying it down can help your budget and your mortgage approval. Talk with your loan consultant about the balance between paying debt and saving cash.

Pick a target amount and date, then check your balance each month. Seeing the number grow helps you stay with it. If you fall behind, adjust your timeline or your price range rather than giving up. A loan consultant can show how different down payments change your monthly payment, so you can decide how much is enough.

Many loan programs allow gift money from family for a down payment, with a signed gift letter and proof of the transfer. Down payment assistance programs can also help. In Virginia, CapCenter offers Virginia Housing programs, including grants that don't need to be repaid and a second mortgage that can help with the down payment. Program limits apply.