Becoming a homeowner is a huge financial undertaking, requiring far more than a simple down payment. So how do you determine exactly how much do you need to save to buy your first house? First, start by figuring out where and how you want to live. The more you can identify your preferred home area, the better. You need to answer these questions:

• Do you want to live in an urban or suburban neighborhood?
• Would you consider a rural area with acreage?
• Is a condo complex acceptable or do you prefer a single-family home?
• How long are you willing to commute to work?
• Do you want to drive, ride mass transit or walk to normal destinations: work, grocery stores and general shopping and dining?

Once you determine location, determine how much home you can afford, based on your current income, expenses and future goals to save to buy your first house. Keep in mind that just because you can afford a bigger space doesn’t mean you necessarily need one, and more space can mean higher real estate taxes (not to mention upkeep).

Nearly all mortgage loans and lenders require some amount of cash as a down payment. The amount you’ve set aside for this will determine the kind of mortgage you can qualify to get. It will also impact how much you can afford to borrow for a home.

Here’s a good rule of thumb: research the average price of a home in your dream neighborhood. Take 20 percent of that price: that equals your hypothetical down payment. Calculate how many months it would take you to save that needed down payment amount. However, there are several loan options from which to choose that will help you with the amount of down payment you can afford today. Take a look at the loans offered below.

At Chelsea State Bank, our loan officers are ready to work with you to determine the best loan option and how much or how little you will need to buy that first home. Chelsea State Bank offers fixed rate and FHA loans.

Save to Buy Your First House with a Fixed Rate Mortgage

Your payment will always remain the same, helping you to plan and budget, staying on track with payments. Chelsea State Bank offers a variety of terms to give you choices in both payment amount and when you make the final payment on your home.

Advantages to a CSB Fixed Rate Mortgage include:

• Fixed payment every month
• Clear terms and pay-off date
• Pre-qualification
• Partnership with trusted CSB Mortgage expert

How Much is Needed with a FHA Mortgage

A mortgage backed by the Federal Housing Administration (FHA) provides a way for those who do not meet the requirements of a conventional mortgage to still be able to purchase their own home.

An FHA loan offers a minimum down payment of 3.5 percent and is available to people with imperfect credit histories. The FHA charges an upfront premium and Private Mortgage Insurance (PMI) is required.

• Lower down payment option
• Lower credit requirements
• Down payment money may be gifted from family
• Partnership with trusted CSB Mortgage expert

When getting a mortgage loan, always talk to one of our experts at Chelsea State Bank about costs you can expect in the first year and beyond for home ownership. You want to have the full homeownership cost estimate and we can help you make those calculations. Contact our office by phone: (734) 475-4210 or online here.

Chelsea State Bank is an Equal Housing Lender