Finding the money for a home

2-minute readFrom Stage 1: Am I ready?Last reviewed October 2026

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The short version

Most buyers put together their down payment and closing money from more than one place.

Everyday extras. Coffee out, lunches, delivery, subscriptions and nights out are small on any one day, but over a year they often come to thousands of dollars. Keeping part of that money is a steady way to build savings, and you choose which extras matter most to you.
Card interest. The average rate on credit card accounts that pay interest is 22.36%. Every dollar of interest is a dollar that does not go toward a home.
A savings account that earns interest. The money you keep can earn interest while it builds. Savings rates change, and banks set their own. The national average rate on savings accounts is 0.38%, while high-yield accounts often pay more, so the rate is worth comparing.
Gifts. Family can give part or all of the down payment on most loans, with a signed gift letter and a clear paper trail.
Down payment assistance. It is usually a loan secured by a second lien on your home, and only sometimes a grant. We compare your options with and without it before anyone applies.

VA and USDA loans need no down payment for buyers who qualify. With either one, the money to save for is closing costs and a cushion.

Many rural addresses in Southwest Colorado fall inside USDA's eligible areas, so a loan with no down payment may be open to you even if you are not a veteran. Rural purchases also bring early costs, such as earnest money, a well water test and a septic inspection, so plan the first few thousand dollars before you make an offer.

Set your everyday extras, choose Keep, Half or Skip on each, and see how fast the money you keep reaches a savings goal.

Budget Buster. Turn on JavaScript to change the numbers.

These extras cost$12,100 a year

That is $33 a day. Choose Half or Skip on any row.

What you keep, and what you spend

Look ahead3 years

1 year10 years

Kept, saved at 4%At the national average rate, 0.38%Still spent on extrasYour goal

Press or drag the chart to look ahead.

In 3 years: kept $0; spent $36,300 on these extras. Example amounts are filled in; move them to match your own. Nothing you enter leaves this page.

Where the kept money goes

What you keep goes into a high-yield savings account at an example yield of 4% a year, with interest added each month. The dashed line is the same money at 0.38%, the national average rate on savings accounts (FDIC, October 2026). Savings rates change. Banks set their own. No inflation is assumed.

Swap ideas

Choose Half or Skip on a row to see what it keeps and an idea for each.

On a card

A year of these extras carried on a credit card ($12,100) costs about $225 a month in interest at 22.36%, the average rate on credit card accounts that pay interest (Federal Reserve G.19, August 2026).

Hours of work

Add your take-home pay per hour to see these extras in hours of work.

What a lender sees

Lenders review recent bank statements for deposits, balances and overdrafts. Card balances add minimum payments that count in your debt-to-income ratio. Save in a bank account rather than cash, so the money can be documented. See the affordability calculator and how much you need saved.

Open it full size

Go deeper

What everyday extras add up to

Small amounts are easy to overlook because no single one feels large. For example, $5 a day on coffee and drinks out is $1,825 a year, and $12 for lunch out on each workday is $3,120 a year. Together that is $4,945, about a third of a $15,000 down payment, 5% on a $300,000 home.

None of these extras is wrong. The goal is to choose. Keep the ones that matter most to you, cut others in half, and move what you keep into savings on the day you are paid, so it is set aside before it is spent.

Card interest works against savings

At 22.36%, a $3,000 card balance costs about $56 a month in interest, or about $671 a year (Federal Reserve G.19, August 2026). Paying a balance down keeps that money for you.

Card balances also matter to a lender. Each card's minimum payment counts in your debt-to-income ratio, and high balances can lower your credit score. Ask us before you pay a balance off with money you have saved, because the same cash may be needed at closing. We can show you which use of the money helps your loan the most.

Savings that earn interest

A high-yield savings account adds interest to your balance each month, and the next month's interest is figured on the larger balance. For example, $500 a month saved at an example yield of 4% grows to $19,091 in three years, $1,091 of it interest. At the national average rate of 0.38% (FDIC, October 2026), the same savings earn about $100. Saving toward $15,000, the example yield reaches it in month 29 instead of month 30.

Savings rates change, and banks set their own, so the yield in this example is not a rate anyone is offering. Keep the money in an insured bank or credit union account rather than in cash, so a lender can document where it came from. Money in investments can fall in value just before closing.

Gifts, assistance and loans with no down payment

Gifts. On a conventional loan for a one-unit home you will live in, the whole down payment can be a gift from a relative or someone with a long-standing, family-like relationship. FHA, VA and USDA also allow gifts, each with its own rules. The giver signs a letter stating the amount and that no repayment is expected, and the lender documents the money as it moves.

Down payment assistance. Most assistance is a loan secured by a second lien on your home, repaid when you sell or refinance, and only some of it is a grant. The first mortgage that comes with it can also cost more. We show you each option with and without assistance before anyone applies, so you know what it costs and what you would owe.

No down payment. A VA loan needs no down payment with full entitlement. USDA loans need no down payment for buyers within USDA's income limits buying in an eligible area. Closing costs still apply, and sellers can pay some of them on every loan type.

See it with your numbers

Your Mortgage Plan shows the cash to close for each option, so you know the amount to save for, and how a gift or assistance would change it.

Get your Mortgage Plan

The “Your cash to close” section of a Mortgage Plan: a bar for each option split into down payment, lender and title fees, and prepaids.

Your next step

Step 5 of 14Are you a first-time buyer?A first-time buyer usually means no home owned in the past 3 years. It allows 3% down on a conventional loan and can require a homebuyer class.Go to step 5

Leave the path: I will need help with the down payment I am a veteran or service member Show me the next step

Previous step: How much you need saved