How to obtain capital for the down payment on a mortgage?

Do you already have the necessary own funds to move forward with the housing loan? Don't waste any more time, contact the credit intermediaries at Poupança no Minuto and let's move forward with your process. If you still need to discover methods to save money for the down payment to give to the bank, we explain next.

Since banks currently only finance a maximum of 90% of the value of the property for own and permanent housing, and a maximum of 80% for secondary housing, the customer has to provide at least 10% and 20%, respectively, of the appraisal value or acquisition of the house (the lowest). Therefore, let's go through the various steps you should follow to save money.

Start by creating a savings account/emergency fund.

If you want to start saving money, the first step should be, of course, to create a space where you can put those funds. Ideally, it should be a bank account, and not saving the money physically. In any method, it should be difficult to access.

For example, if you create a savings account or emergency fund, this bank account should be from a different bank than your main account, so you can't easily transfer funds between them. If you can easily transfer between accounts, you may be tempted to do so for convenience.  

If you can access the money in cash, the same thing happens. So, if you do so, put at least the money in a piggy bank that can only be accessed by breaking it. It makes the process more complex, and you won't have as much impulse to get the money.

Reorganize the monthly budget.

To save money, you must first reorganize your current monthly budget. If you don't usually keep track of your expenses compared to your income, then it's time to start doing it.

Tracking our expenses is the best savings strategy, to understand what we are spending essentially and unnecessarily. The exercise we should do to begin budget organization is: "Where can I cut and what can't I give up?".

Start by listing all your income. Then, write down your fixed and essential expenses, with their respective amounts (gasoline, food, loan payments, etc). Next, assign a value to variable expenses as well (entertainment, dining out, etc). Finally, set aside a value to allocate to savings. And the goal will be to stick to all the values you have assigned, without exceeding any category. 

Opt for savings strategies.

There are various savings strategies that can help you in the short, medium, or long term. Some are just small steps to insert into your daily life and, if you absorb them into your routine for some time, can make all the difference.

We have as example strategies like the well-known "50/30/20". In this one, the objective is to divide your income according to the expenses you have to make.

In other words, 50% of the income you earn should be used to pay fixed expenses such as rent, loan installments, school fees, groceries, water, gas, telecommunications, fuel, etc; then, 30% of the income is allocated to expenses related to lifestyle and personal care, and the remaining 20% of the income should be put into a savings fund or emergency fund. This saving, in this case, will go towards your next goal: to have your own capital for a housing loan down payment.

But there are numerous other strategies, such as the 52-week challenge, which consists of saving one euro in the first week, two in the second, and so on. This will allow us to save 1,378 euros at the end of the year (52 weeks).

Another strategy, which involves not exceeding the value defined for variable expenses in the budget, can be an exercise to be carried out whenever making a purchase. To understand if the purchase you are about to make is essential, imagine the following scenario: if someone came up to you and gave you the choice between the product in question or the amount it costs, what would you choose? Well, if you choose the money it means that you do not necessarily need this product right now...  

Invest in financial products with guaranteed capital

Have you ever thought about investing your money, so that, like a plant, after planting the seed, it begins to grow? This can be a good way to build up your own capital. However, they should be financial products with guaranteed capital, meaning with a guaranteed return.

It is the example of the Pension Savings Plan, whose return can be guaranteed, but with little profitability. This happens in the case of PPR Funds, where you can choose the fund that suits you best according to the level of risk. Products with capital guarantee do not have as much expectation of appreciation. However, in the long run, it can generate a solid savings.

There is also the option of State savings certificates, products with a return that is automatically reinvested. This is because it represents the power of compound interest through interest generating returns on interest. The risk in this case is also low.

And still with capital guarantee, the solution for capitalization insurance, with a guaranteed interest rate every year. This can change with policy renewal.

Turn a hobby into a service

If you have a hobby or activity you enjoy, why not monetize it? Turning your passion into a service that can generate income can be a good option.

Let's see: if you like to cook, you can start a business selling meals or pastries, promoting it on social networks or through a website. Or if you enjoy drawing, why not frame your drawings and sell them?

Think about your preferences and what could give rise to a profitable business. You may be missing out on a source of income that, in the medium/long term, could help you with your own capital for the entry of your housing credit!

Get informed, ask for help, and choose the best proposal.

The essential piece of this puzzle is to get the most suitable offer for you, providing the highest savings, with the best conditions and the lowest down payment to the bank. And how to do that? By asking for help!

Know that with a credit intermediary, not only can you get help through a free service, but you will also have no shortage of information and support. Intermediaries clarify all your doubts, handle all the bureaucracy and communication with banks, and negotiate the right conditions for you.

The Poupança no Minuto provides a personalized intermediary service, where you communicate with only one agent throughout the entire process, so that together they reach a single goal: Saving.