In our last lesson we talked about the hidden cash you may have access to, that you can use to create a down payment for your dream home. Today we’ll talk about the numbers, how going backward may help you figure out just how much money you might need to get into your dream home.

The way it works is this.　Instead of paying a “Security Deposit” like most people are familiar with, your investment will be called an “option fee.” This is similar to a down payment, but it secures your right to buy this home in a year or two for a price that you agree to today. 　This means, when you’re ready move in, you’ll need to have this option fee as well as your first month’s payment.

Let’s break it down to make it clearer.

The amount of the option fee is generally going to be anywhere from 2% to 5% of the purchase price of the home, but is usually right around 3%.

For instance, on a $90,000 house your option fee will probably be about $2,700 (using 3% as a guide).

How amazing is that?!　Were you aware that you can buy an entire house for less than $3,000?　I’ll bet your income tax refund was bigger than that last year!

Saving Program May Be Available…

Here’s something to keep in mind too…　Sometimes the option fee can be spread out over several months to help you pay it on time.　Every home and every transaction will be different, so you can’t assume that will be the case.　It will depend on what the seller agrees to.

Option Fee Much Lower So let’s say the monthly payment on your new home is going to be $900 plus your $2,700 Option fee.　That means you will need about $3,600 to get into your home. That’s not too bad considering it typically takes around $18,000 to get into a home, and that’s if you have stellar credit.　Can you see why this process is such a powerful tool for you.　By now you should understand how our system works!　

I hope this is becoming clearer to you now.　I’m sure you’re getting excited to realize how close you are to moving into that dream home.　

In the next lesson we’ll take yet another step in your journey to home ownership.

Take care, 　

Gilles

PS: Just a quick reminder: If you still have not conquered Step 1 in the process (finding out your credit score) then quickly get on with it.　 Now you can improve your score by going over to this cool website. In no time you will understand the in’s and out’s, do’s and don’t of the credit business  Yes, a business!

PS: Your next mini course is awaiting you by clicking here