304 North Cardinal St.
Dorchester Center, MA 02124
304 North Cardinal St.
Dorchester Center, MA 02124
When taking out a mortgage, you must get a savings account. A savings account will have the funds in place for when the next mortgage payment arrives.
But what savings account is best for mortgage? The Citibank Accelerate Savings that has a .50% APY is the best savings account for a mortgage. The Citibank Accelerate Savings account offers physical and online banking, which is great for borrowers who need flexibility.
The best savings account for mortgage allows you to make quick payments and have customer service if any issues arise. When looking for a savings account, check to see if it requires a minimum balance. If it doesn’t, it is easier to create the account and start preparing for the next mortgage fee.
This article was made to help you determine what makes a good mortgage savings account. We’ll even show a few examples of banks to help you save money for your mortgage.
By the end, you’ll have enough information to help you prepare for your next monthly mortgage payment.
To explain, a savings account is where money is deposited and receives interest over time. Since you’re using this money for your mortgage, you’ll want it to be easily accessible.
Sometimes, the savings account will have a fixed interest rate and temporarily restrict access to your account. Fixed savings accounts tend to have better savings than accounts that provide easier access. Meanwhile, easy access accounts have variable or lower interest rates.
Mortgage savings accounts come in two different forms: online banking or a physical banking location. An online savings account offers more flexibility as you can access it via computer. For those who prefer face-to-face interaction, physical branches are available.
When using traditional banks for a savings account, you get access to features such as an ATM, debit card, and branches. However, they have a strict application process, meaning that you’ll need a certain balance to keep the account active.
With an online savings account, you can pay your mortgage fees through an eDeposit. eDeposits allow you to instantly add your check onto their platform and pay your mortgage fees. Use an online savings account if you want a more accessible option.
But an online savings account is not without its vulnerabilities. You cannot make a direct deposit, which can lead to difficulties if you have a financial emergency. When getting an online savings account, make sure your information is private to prevent hackers from sabotaging your account.
Here are some examples of some bank companies that provide savings account for a mortgage:
Finding the best savings account for a mortgage will take some time at first. Take time to compare the different banking options available and see which one suits your needs the best.
After deciding how much you have to spend on mortgage fees, here are some ways to save for it:
Let’s face it; if you don’t pay off your mortgage on time, you run the risk of losing your home. Fortunately, some apps are available that will help you better track your spending.
Apps such as Oval can round what you’re spending to the nearest zero. Then, they will deposit that amount into your savings account.
However, most budgeting apps don’t have an interest in your spending. Because of this, you should transfer your funds to a mortgage savings account that pays interest.
If you are a heavy spender, consider using a cashback card. This will allow you to get a portion of what you’re spending as a form of credit. To get the most out of a cashback card, you have to use it 2-5 times a week.
When using a cashback card, make sure you pay the monthly balance. Like mortgages, the monthly balance will have penalties if you don’t pay it on time. The added interest that they charge can outweigh your earned cash.
Compile your credit card payments and bank statements. Look at where you’re spending the most of your money. Analyze how much you spend on necessities (i.e., rent, utilities, food) and how much you spend on entertainment (Netflix, gaming, etc.).
Making minor changes to your daily spending will add up over time. Recheck your monthly bank statements carefully to make sure you haven’t missed out on any transaction. Perhaps you realized that you’re spending over $200 a month on clothes or $600 annually on drinks.
Identifying these areas you’re spending heavily on can free up extra cash to be placed in the deposit fund.
While it may be tempting to go out on vacation, it can be expensive. On average, a family of four will pay around $4,500 on vacations. This can be a lot of cash that could be saved for your mortgage payments.
Instead, save that money for a mortgage payment and make a staycation in your current area. For instance, you can visit an art museum or a historical site nearby to experience culture at a reduced price.
For frequent travelers, the feel of seeing something new is the best part of a vacation. Make a new artwork at your local art center or try new foods at a local cooking class to recreate this experience.
To conclude, the best savings account for a mortgage will depend on if you want to make payments online or in person. When saving up for a mortgage, try to cut down any unnecessary expenses. That way, you’ll have enough money to prevent your house from entering foreclosure.