August 2022 mortgage blog banner, mobile view, Travis CU

How to Save Money for a House

Saving money for a down payment to buy a home may feel like a daunting task but it doesn’t have to be. By learning about the pillars of financial wellness, you’ll have the tools to not only become a homeowner but be better prepared to meet all of life’s financial challenges.

What do we mean by “pillars of financial wellness”? We’re describing the four categories that pertain to basic money management: Plan, Save, Spend and Borrow. When you gain a greater understanding of each of these areas, you’ll know what to do to save money for a down payment and be prepared to handle many other money-related goals.


The first step to saving for a down payment is to find out how much home you can afford. Travis Credit Union’s free Mortgage Qualifier calculator can help you determine your housing budget based on your household income.

Next, determine how much you’ll need to save to meet different down payment scenarios. For example, a standard 20% down payment means you’d need to save $20,000 for every $100,000 in purchase price. Now that you know your down payment target, create a plan to reach it.

If you find the amount of the down payment too high for you to achieve, don’t fret, you have options. There are first-time homebuyer and homebuyer assistance programs available that require less than the 20% down payment. For example, FHA (Federal Housing Administration) loans typically require only 3.5% down, which is only $3,500 for every $100,000 in purchase price.

You can also review options with lenders to see if they offer any kind of lender credits to help you absorb some of the closing costs. This will make more money available for your down payment.

Remember, if you’re putting less than 20% down your lender will require that you add Private Mortgage Insurance to your mortgage to protect their loan in case you default. PMI will increase your monthly payments slightly and you can ask that it be removed after a certain period.


Now that you’ve identified the amount of money you need, it’s time to act. One of the best and easiest ways to save is to automatically deposit money in a savings account through Direct Deposit.

First, open a Travis Credit Union Target Savings Account, which is designed to help you set aside money. Next, have a portion of your bi-weekly or monthly paycheck directly deposited to this account. This will eliminate the need for you to make deposits at a branch or ATM.

If you need to generate additional income to meet your down payment goals, consider taking on a second job. The gig economy makes it easier than ever to take on side work to help meet your financial goals.

For example, if you’re a subject matter expert you can visit platforms such as Upwork, TaskRabbit or Fiverr to take on short-term projects in your field. If you want to work more on your schedule and have a reliable car, consider ridesharing and delivery service apps such as Lyft and Door Dash, where you set the hours you want to work.


Another pillar for financial wellness is having a strategy on how you spend. With so many ways to buy things today, it is smart to review your expenses and identify areas where you can cut back and save more for your down payment.

Some ways to reduce your spending include stopping monthly subscription services and other recurring charges that you seldom use or aren’t interested in anymore. You should also review your utility and insurance providers to see if there are any discounts you may qualify for. And if you’re not particular about your cable service or Internet provider, try shopping around to see if there’s a better deal in your area. Any savings should be redirected toward your down payment savings account.


Once your down payment savings plan is established, it’s time to learn about the various homebuyer programs available so you can borrow smarter. For example, groups such as Veterans and active-duty military may qualify for a special government home loan with 0% down payment, in recognition of their service.

If you are a first-time home buyer or are in a lower income bracket, search for government-sponsored programs designed to provide access to equal housing. These types of loans often require lower down payments or offer down payment assistance in the form of a loan that can be forgiven after a certain number of years of home ownership.

To learn more about what loan programs are available to you, speak to a Travis Credit Union mortgage loan consultant. We will walk you through the entire loan process, from down payment to closing.

As for the lender, consider credit union financing rather than a large commercial bank. Travis Credit Union and other credit unions are local lenders that typically offer better rates and service because of their focus on helping people. Wherever you go, be sure to compare rates from several lenders before initiating your loan application.

For those with a 401(k), you could consider borrowing money for a down payment, but be cautious. Review your 401(k)’s plan thoroughly to understand the rules. Consult your tax advisor about any tax consequences and penalties if you borrow from your 401(k).

Travis Credit Union offers free webinars to help you prepare to buy a home. You can learn about the four Cs to homebuying (capacity, character, capital, and collateral) by watching this webinar. Discover more about how Travis can help with your financial wellness by visiting

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