One of my favorite parts of being a Myrtle Beach real estate agent happens before we ever look at a house.
When a new buyer reaches out, I like to start with a consultation. After having hundreds of these conversations over the years, especially with first-time homebuyers, I've noticed something.
People are often terrified.
They've heard they need 20% down. They're unsure how much money they actually need to buy a house. They've gotten advice online, from friends and family who haven't purchased in years, or sometimes they've had a bad experience that left them confused about the home-buying process altogether.
Before we start looking at houses, I want my clients to understand the process.
I don't want someone making one of the biggest financial decisions of their life from a place of fear. I want them making decisions from a place of knowledge and confidence.
And sometimes that starts with something as simple as changing the name of a savings account.
Stop Calling It an Emergency Fund
I understand the purpose of an emergency fund. But I've always wondered about the psychology behind the name.
Emergency Fund.
We're saving money while attaching it to the expectation that something is going to go wrong.
For a first-time buyer trying to create a different future, I prefer something that pulls them forward.
Call it your New House Fund.
Give it a purpose. Give it a deadline. Put the goal on your calendar.
Then figure out what it will actually take to get there.
One of the biggest misconceptions I hear from first-time buyers is that they need 20% down to purchase a home.
They don't.
Depending on the buyer and loan program, there are financing options with much smaller down payments. FHA loans, for example, can require as little as 3.5% down. There are also conventional loan options that may allow buyers to purchase with a down payment as low as 5%.
There are closing costs to consider, too, and depending on the property and market, we may be able to negotiate for the seller to contribute toward some of those costs.
Every buyer's situation is different, which is why working with a knowledgeable lender is so important.
But here's the bigger point:
Find out what you actually need before deciding that you can't afford to buy a home.
Before You Save More, Find Out Where Your Money Is Going
When someone tells me, "I can't save enough money to buy a house," I sometimes give them homework.
Pull your last three months of bank and credit card statements.
Get a notebook and write down every expense.
Food. Restaurants. DoorDash. Gas station stops. Amazon. Subscriptions. Entertainment. CVS. Shopping. Car payments. Utilities. Everything.
Categorize it and total it.
It sounds incredibly simple, but the purpose is awareness.
Because if you don't know where your money is going, how can you decide where you want it to go instead?
A few years ago, a young woman contacted me looking for a rental. She was living with her parents at the time and was getting ready to move out. During our conversation, I asked her why she was planning to rent and whether she had ever considered buying a home.
Her answer was immediate:
“I can’t afford it.”
So we had a consultation, and I gave her this exercise.
When she came back with her statements, we discovered that over the previous three months, she had spent approximately $3,000 on snacks, fast food, gas station stops, miscellaneous purchases and other everyday spending she wasn’t really tracking.
That was about $1,000 a month.
She wasn’t intentionally spending that much. It was happening little by little, and she simply hadn’t realized how quickly all those small transactions were adding up.
She already had some money saved because she had been preparing to move out of her parents’ home. Once she understood where the rest of her money was going, she could start making different choices.
About six months later, we closed on her first home. She was 24 years old.
That experience stayed with me.
Buying Your First Home Starts With Awareness
I still do this exercise with my own finances.
There are plenty of apps that can track spending automatically, but I personally like doing it manually. There's something about writing down each expense and calculating the total that makes the number real.
The best system is the one you'll actually use.
So whether you're thinking about buying your first home, relocating to the Grand Strand, or simply trying to improve your finances, start with one question:
Do you know where your money is actually going?
Not where you think it's going.
Where it's actually going.
Look at the last three months.
You may discover that you truly need more income or more time to reach your goal. That's okay. At least now you know.
But you may also discover that the money isn't entirely the problem.
It's the DoorDash orders. The Amazon packages. The quick stops at CVS. The purchases that seem insignificant individually but become thousands of dollars when you put them together.
And once you're aware of it, you have a choice.
Maybe that money doesn't need to disappear into another year of small purchases.
Maybe it starts going somewhere with a name.
New House Fund.
Because change starts with awareness. And sometimes the first step toward buying a home isn't finding the house.
It's finding your money.
-Maria Mendoza
