Hello Millennials, remember times you’ve spent thinking about buying your first home? From a survey of 2,000 millennials, 85 percent of young people expect to own a home at some point in their lifetime. There are hundreds of home buying guides on the Internet, with very few geared toward millennials. Knowing what we know now, it’s safe to say that millennials entering the housing market need extra support. Here are 25 real-life tips a millennial can do to save for their first home.

First Time Home Buyer Tip 1 – Save Exclusively

Create special savings account exclusively for your home purchase and have part of every paycheck automatically transferred to that account. Start with as little as $100 if you can afford it so you get used to living on less and then gradually increase the amount.

First Time Home Buyer Tip 2 – Build Credibility

Consider saving the difference between your rent and anticipated housing payment. This increases your savings, and you’ll also show the lender an established savings pattern and the ability to afford the housing payment.

First Time Home Buyer Tip 3 – Boost Your Income

Work extra hours or take on a second job temporarily to increase your income. Even something simple like walking dogs each evening or babysitting can help accumulate your savings quickly.

First Time Home Buyer Tip 4 – Save Extras

If you get a bonus, a tax refund or a cash gift, deposit it into your home-buying account.

First Time Home Buyer Tip 5 – Know Geography & Taxes

Property taxes are assessed by the county you live in and average 1.09% of your home’s value each year.

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First Time Home Buyer Tip 6 – Do A Thorough Check

When looking to buy a home, check the age and condition of the expensive fixes: furnace, roof, windows and appliances. Repairs for these can easily set you back $5000-$15000 apiece.

First Time Home Buyer Tip 7 – Shop (hard) For Your Mortgage

Start shopping for a house after you get a pre-approval for a mortgage. Saving half a percentage point (0.5%) on a $200,000 home loan can save you $64/month, or $23,000 over the life of a 30 year mortgage. Researching your financial options with multiple lenders is the best way to get lowest interest rates. Consult with a mortgage broker for this process.

First Time Home Buyer Tip 8 – Forecast All Expenses

As a buyer, you need to be aware of all expenses, both short-term and yearly. The average purchase costs include the following:

Down Payment——— $20,000 Closing costs———- $8,300 Appraisal fee———– $350 Home Inspection—– $500

The Yearly costs include:

Mortgage payment—-$3,367 Interest———————$7,580 Property taxes———-$2,512 Utilities———————$1,295 Renovations————-$2,300 Maintenance————$1,360 Homeowner’s insurance–$1,000 Private mortgage insurance–$670

*-The above figures are approx and may vary with location and transaction. Always check the costs associated with your transaction.

First Time Home Buyer Tip 9 – Take Into Account HOA Fees

Homeowner’s association fees can be as low as $0 or as high as a few hundred dollars per month, depending on where you live and the amenities/services offered. But, HOA fees often range from $200-$400 per month.

First Time Home Buyer Tip 10 – Sidestep Private Mortgage Insurance (PMI)

If you don’t have 20 percent to put down, you can obtain a mortgage with as little as 3 percent down. However, if your down payment is less than 20 percent, you’ll have to pay PMI which is about 0.85 % of your loan amount and isn’t tax deductible. That’s $17,000 over a 30 year, $200,000 mortgage. Try avoiding PMI.

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First Time Home Buyer Tip 11 – Choose the RIGHT Mortgage

30 Year mortgage- Over the life of a $200,000, a 30-year mortgage at 5 percent, you’ll pay 360 monthly payments of $1,073.64 each. Total= $386,511.57 Vs 15 Year mortgage- Over the life of a $200,000, 15 year mortgage at 5 percent, you’ll pay 180 monthly payments of $1,581.59 each. Total= 284,685.71 (which is much cheaper) Choose the right mortgage.

First Time Home Buyer Tip 12 – Pay Extra

Save yourself time and money by making extra mortgage payments each month or year. On a 30 year $250,000 mortgage at 6 percent interest, paying an extra $100 each month will cut four years and nearly $72,000 off the loan term.

First Time Home Buyer Tip 13 – Bundle Insurance

Explore bundling your home, auto, and other insurance together. Shop around, you can save hundreds of dollars each year if you find a good package deal.

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First Time Home Buyer Tip 14 – Study The Market

Make sure you know exactly what other homes are listed and selling for in the area you are looking to buy. This will give you a solid idea about how much you can expect to pay for a home of similar specifications. This will make you more informed in the negotiation process and keep your agent honest when working through the terms of the contract.

First Time Home Buyer Tip 15 – Check Your Credit

When you’re taking out a mortgage loan, your credit will be one of the key factors in getting approval helping determine your interest rates and loan terms. So, check your credit before you begin the home buying process. Dispute any errors that could be dragging down your credit score and look for opportunities to improve your credit, such as clearing any outstanding debts.

First Time Home Buyer Tip 16 – Pause Any New Credit Activity

Any time you open a new credit account, whether to take out an auto loan or get a new credit card, the lender runs a hard inquiry, which can temporarily lower your credit score. If you’re applying for a mortgage soon, avoid opening new credit accounts to keep your score from dipping.

First Time Home Buyer Tip 17 – Explore Your Down Payment Options :

Struggling to come up with enough money for a downpayment? You could try Federal Housing Administration loans, which permit down payments as low as 3.5%. Try crowdfunding or ask if family members are willing to pitch in with a gift. Research State and local assistance programs: In addition to federal programs, many states offer assistance programs for first-time home buyers with perks such as tax credits, low down payment loans and interest-free loans up to a certain amount. Your county or municipality may also have first-time home buyer programs.

First Time Home Buyer Tip 18 – Budget Closing Costs

In addition to saving for a down payment, you’ll need to budget for the money required to close your mortgage, which can be significant. Closing costs generally run between 2% and 5% of your loan amount. You can shop around and compare prices for certain closing expenses, such as homeowners insurance, home inspections, and title searches. You can also reduce costs by asking the seller to pay for a portion of your closing costs or negotiating your real estate agent’s commission.

First Time Home Buyer Tip 19 – Consider What Type of Property To Buy

You may assume you’ll buy a single-family home, and that could be ideal if you want a large lot or a lot of room. But if you’re willing to sacrifice space for less maintenance and extra amenities, and you don’t mind paying a homeowners association fee, a condo or townhome could be a better fit.

First Time Home Buyer Tip 20 – Decide If Paying Points Makes Sense

Lenders often allow you to buy discount points, which means prepaying interest upfront to secure a lower interest rate. There may also be an option for negative points, in which the lender pays some of your closing costs in exchange for a higher interest rate. How long you plan to stay in the house is one of the key factors in whether buying points makes sense. You’ll need to do some calculations or speak to a mortgage broker or loan officer to help you decide if buying points are worth for you.

First Time Home Buyer Tip 21 – Get A Preapproval Letter

You can get prequalified, which simply gives you an estimate of how much a lender may be willing to lend based on your income and debts. But as you get closer to buying a home, it’s smart to get a preapproval, where the lender thoroughly examines your finances and confirms in writing how much they are willing to lend you and at what terms. Having a pre-approval letter in hand makes you look much more serious to a seller and can give you an upper hand over buyers who haven’t taken this step.

First Time Home Buyer Tip 22 – Stay Under Your Pre-Approval Limit

As your agent shows you homes, look for properties that cost a little less than the amount you were approved for. While you can technically afford that amount, it’s the ceiling — and it doesn’t account for a broken washer or dryer or any other expenses that arise during homeownership, especially right after you buy. Rather than maxing out that amount, set a lower purchase budget to leave yourself wiggle room for unexpected costs.

First Time Home Buyer Tip 23 – Negotiate

A lot can be up for negotiation in the homebuying process, which can result in major savings. Are there any major repairs you can get the seller to cover, either by fully handling them or by giving you a credit adjustment at closing? Is the seller willing to pay for any of the closing costs? If you’re in a buyers market, you may find the seller will bargain with you to get the house off the market. Write a personalised cover letter to the seller on why you would love to buy their house. Research why they are selling it and future plans. If they could relate to your dreams and aspirations, they might even give you preference over other offers.

First Time Home Buyer Tip 24 – Buy Homeowners Insurance

Before you close on your new house, your lender will require you to buy homeowners insurance. Shop around and compare rates to find the best price. Learn what’s covered in the policies; going with a less expensive policy usually means fewer protections and more out-of-pocket expenses if you file a claim. Be aware that your insurer can drop your property if they think the home’s condition isn’t satisfying, so you may have to be prepared to find a new policy quickly if they send someone out to look at the property and aren’t happy with findings. Also, flood damage isn’t covered by homeowners insurance, so if your new home is in a flood-prone area, you may want to buy separate flood insurance.

First Time Home Buyer Tip 25 – Know The Limits of A Home Inspection

Once your offer is accepted, you’ll pay for a home inspection to examine the property’s condition inside and out. But not all inspections test for things like radon, mold or pests, so be sure you know what’s included. Make sure the inspector can access every part of the home, such as the roof and any crawl spaces. Attend the inspection and pay close attention. Don’t be afraid to ask your inspector to take a look — or a closer look — at something and ask questions. No inspector will answer the question, “Should I buy this house?”, so you’ll have to make this decision after reviewing the reports and seeing what the seller is willing to fix.

Final thoughts

If you’re renting now but planning to eventually buy a home, burning 35 to 50 percent of your income each month on rent does not always feel like the best way to save for your future. In a traditional rental situation, you will never see a penny of your rent come back to help you in the future. Instead of building equity in a home you own, you get short-term convenience at a steep price.

Onerent is pioneering a new way to rent with the launch of a first-of-its-kind product named “Poplar Street”. When you sign up for Poplar Street, you can earn 20 percent back on each month’s rent payment as a credit towards buying your first home. By saving a portion of your rent for a future home purchase, you get the convenience of renting plus the tools to build equity in your future home purchase.

Get early access to the Poplar Street below to be the first to know about homes enabled with the program or to convert your current rental to a Poplar-enabled home.