Saving for a Down Payment

Saving for a Down Payment
Lenders are shying away from offering riskier "subprime" mortgages amid worries about rising defaults.
As a result some would-be home buyers with little savings are being turned away.

WHAT TO DO: If you don't qualify for a loan because you have no down payment, stop shopping for homes and start getting your house in order. To save more, spend as if you've already bought a home. If your mortgage payment would be $2,500 and your rent is $1,500, deposit the $1,000 difference automatically into a high-yielding savings account each month. (You can find yields of 5% or more on savings accounts. Sock away sudden windfalls, such as tax refunds, bonuses and reimbursements from flexible-spending accounts.
Another way to save more is to earn more -- here are some tips to boost your pay. For more ways to save, click here. --Terri Cullen, 2/26/07