So you’ve finally settled on it. You want your dream home in NYC. Or maybe you’re just looking for something a little larger than your current apartment or closer to work. Whatever your reason for wanting to buy an apartment in NYC, like every buyer, you’ll need enough saved for a down payment. Maybe you’ve already found the right apartment but are just a bit short on the minimum needed for the down payment. Read on to learn how you can help save towards homeownership.

Why down payments matter

Your down payment is the money you bring to seal a purchase contract and show that you’re serious about buying. If you’re applying for a mortgage it shows lenders that you’re financially capable of coming up with money. Plus, the more you can put on your down payment the lower your monthly payments will be. In NYC, the minimum down payment is 10% of the purchase price. But not a lot of buyers will be thrilled by this and are unlikely to take it seriously unless there is very little demand for the property.

20% is far more common and is the standard threshold for co-ops. Any down payment below 20% will require the buyer to pay something extra Private Mortgage insurance (PMI). This is an insurance policy which ensures that in the event of a default the insurance bails you out and pays the lender. Should that happen your credit will still be ruined, and you’ll face the consequences of default.

So it makes sense to try everything to save that 20%. Sometimes buyers turn to family for gift funds to help then reach that magic number. Whether you choose to do that or not, you’ll still want to work to save as much as you can. Saving money for a down payment is just like saving for anything else. Have a plan and stick to it.

1. Create a monthly budget

Better to get the boring part out of the way first. You can’t save without a budget. Figure out how much you need to save and what expenses you can cut to help you reach that goal. No one likes having to make sacrifices but that’s what it takes. Sites like Mint and You Need a Budget can help you stay on track. To make things easier, set up a savings account and put part of your salary in there every month.

2. Cut one bill, then another

While working on your budget look for bills that you can cut. Start with one bill for the first month and next month find another that you can do without. Then put the money you save into your savings account. Trim is a great app to help you monitor your spending and find subscriptions you can cancel.

3. Start a side hustle

You don’t necessarily need to get a second job to save more money. It is possible to earn something on the side, usually by monetizing a skill you already have. For instance, if you do photography you could start doing photos for weddings, parties or family portraits. Other side hustles that can be a good source of income include freelance writing, dog walking and selling handmade crafts online through sites like Etsy. Instead of spending your money from the side hustle put it all in your savings account.

4. Tap into your 401K

This can be risky but it’s one of the fastest ways of obtaining cash for your down payment. However, it’s not to be done without a clear understanding of the tax repercussions from taking a loan out on or withdrawing money from your 401K. if you’re still a long way off from retirement age and can replace the withdrawn funds before then, tapping into your 401K can be a great option.

5. Sell things you don’t need

Make use of sites like eBay, Craigslist, and OfferUp. Almost every household has clutter lying around that hasn’t been used in months or years. Go through your entire home and find anything that you can sell. Doing this also means you’ll have fewer things to move when it comes time for moving day.

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