those who've bought a home

[rcwant2be]

& made a down payment...roughly how much money did you keep in your immediate reserves after putting down the down payment.

i am looking to start saving for a down payment & i am wondering how much should go for down payment & how much should be held back as a "homeowner emergency fund".

thanks!

[Lady T]

The common rule of thumb is six months worth of mortgage payments.

[Shaky]

Ideally I think you should have in your savings at least 3 months of expenses for emergency but I would say keep whatever you feel comfortable with. Keep in mind buying a home always brings more expenses after closing day. At the same time you want to put a down payment that will bring your monthly payments to the amount you want.

[gunsgirl]

for a down payment 20% of the estimated cost of the house - 100,000 dollars = 20,000

for monthly reserve- 6 months of your entire months expenses including food and gas.

[rcwant2be]

Originally Posted by gunsgirl for a down payment 20% of the estimated cost of the house - 100,000 dollars = 20,000 for monthly reserve- 6 months of your entire months expenses including food and gas.

i'm aware of what the standards are. what i'm looking for are real life experiences.

i will be looking for a place that's largely "turn key" that i don't have to put a lot of inputs into before i move in. maybe just paint & that's about it.

[CocoaGoddess]

Originally Posted by rcwant2be & made a down payment...roughly how much money did you keep in your immediate reserves after putting down the down payment. i am looking to start saving for a down payment & i am wondering how much should go for down payment & how much should be held back as a "homeowner emergency fund". thanks!

Hmmmm.....that's a good question, especially if you're planning on buying turn key, and I know you will have a detailed inspection and appraisal before purchasing.

Well, ideally you should have 20% saved to avoid PMI payments, but you could also go less and take out two mortgages to eliminate the PMI. This will give you a larger cash reserve on hand for emergencies.

Also, will you be going FHA, or using any of your state's homebuyer programs? That's something else to take into consideration, because if you get in with 3% down, then you'll be able to still hold on to some of your cash.

And if you buy in 2009, you will also receive the 8k tax credit so .... even more cash reserves. (if you make under 75k, of course)

It's just hard to give you a correct figure because I don't know how much you make, your job stability, your credit availability, the amount you will pay for your mortgage/taxes, and how much your house will be worth.

Come August, we personally hope to have a year's mortgage tucked away solely for emergencies, without it impacting our current lifestyle. Going zero down has pretty much made that possible. I am up every single night worrying about all that could go wrong. But then, we have kids and they like to **** **** up.

I'm not sure if I were young, single, hot and childfree though. You lucky *****.

[USCGBoxerMom]

Real life..it's hard to say RC because everyone is different. Credit scores, your savings etc. are all going to add up to what you need vs. what Joe Schmoe needs.

[gunsgirl]

we went VA- no money down- we had 45,000 in the bank for the stuff we needed for the house.
we had another 20,000 in savings for an emergency- so real life we had 65,000 in combined savings when we bought our house in 07.

our house was mostly "turn key"- we needed to buy a fence, a screen porch, a washer and dryer and a fridge.

[Rich Lunsford]

What a terrific question RC. Most folks I speak with save for that down payment and nothing else. My advice is that just because you are buying a home, does not imply that you can spend every last penny on the down payment. Think of the other things involved in a home. There’s a deposit for just about every bill associated with your house. Figure out that much at the very least and hold this amount in cash. Many people start out their home ownership behind on payments due to the deposits alone. After that, you still need to cover the fixed expenses of life. At a minimum, stay above 3 months of fixed expenses. Be realistic here. You can likely skimp a bit on the grocery bill for a month or two if needed. Give yourself a bare bones three month’s worth of expenses, keeping all upcoming bills current and the lights on. Once you are in the house in earnest for a few months, begin building that emergency fund up to normal levels again. In addition, are you going to use an escrow account or not? If not, be sure that you are able to save enough for the property taxes at the beginning of the year. The tax credits are nice but they don’t always arrive in time to keep your bottom line current. I think it is better to plan ahead and use the tax credit as a bonus rather than part of your budget. Congratulations on the house. By keeping your financial wits about you can make this a terrific move!

Rich Lunsford is a CERTIFIED FINANCIAL PLANNERTM practitioner with USAA Financial Planning Services, one of the USAA family of companies. Rich holds the Series 7 and 66 securities licenses. Rich also holds the designations of Chartered Financial Consultant (ChFC®), Chartered Life Underwriter (CLU®), and CHARTERED RETIREMENT PLANNING COUNSELOR (CRPC®).

Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP® and CERTIFIED FINANCIAL PLANNER™ in the United States, which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

[*skittles*]

I bought a 130k house, and put 30 down on it....

I kept 10 grand in back up just in case things broke and needed repair...like my furnace breaking within the first two months did. I was very happy I had held onto that extra money for emergencies.