We’re bringing you a special blog series from The Accidental Banker. Orv Kimbrough offers a smart, caring perspective on simplifying home ownership, and we are so happy to share his story and lessons with you. This series is part of a paid partnership with Rising Bank, a division of Midwest BankCentre, and we do receive a commission if you take advantage of their services.
The Importance of Ensuring Everyone Has Access to Capital
People often ask how I moved from 20 years in the nonprofit sector to the CEO of Rising Bank. I tell them I’m an Accidental Banker.
I’ve always looked at my career as a calling. My work nearly 20 years ago with a comprehensive community development initiative in one of St. Louis’ toughest neighborhoods reinforced to me that poor people want the same thing that wealthy people want — access to opportunities. They want meaningful employment and they want their kids to go to schools that will actually teach them. They want upward mobility even if it’s for their kids.
One of the best ways I can amplify my impact is to ensure that everyone has access to reasonably priced capital – capital to buy homes, start or scale businesses, or fund educations.
Saving for a Down Payment on Your Home
But for many, saving for a down payment can feel unrealistic. Your down payment on your first home will likely be the single largest investment you’ve ever made. While 20% is the standard down payment, it’s not required. In fact, the average down payment is only 12%. Some loans, like an FHA loan, have a minimum required down payment of 3.5% of purchase price.
If the idea of saving for the down payment still seems daunting, here are some ideas to try:
- Budgeting – If you don’t know where your money is going, you can’t have control over it. There are a ton of great budgeting apps out there now that help make it easier to see where your money goes every month.
- Saving – Transfer a fixed amount into a special savings account every month. Maybe it is $5 or $50. Whatever the amount, have it automatically taken out of your checking account and put into your special savings account. Use that money to pay down high interest rate debt. Make sure you have an emergency fund. Then, use that account to build up your down payment.
- Thinking Ahead – When you get a raise at work, before the raise ever hits your account, have part of it automatically invested into your special savings account.
It’s hard to save for a down payment, but it’s worth it.
If you are ready to take the next step, let Rising Bank help you realize your dream. Learn more here about Mortgages by Rising Bank or get pre-approved today!