David combines steps FOUR and FIVE in his series that shows you how to buy a home. Balance and budget are the key words when it comes to these steps. Why? Because they can be done at the same time. Get ready as David dives into these important steps and also shares some real-life stories of first-time home buyers who experienced this firsthand. Also, listen to get the insider scoop on debt management from David’s unicorn lending team and get tips you can’t find on Google.
Here are some power takeaways from today’s conversation:
Why credit score goes before debt
How to balance debt and saving at the same time
Gross debt vs. monthly debt
How to start with savings

Episode Highlights:
[04:59] DEBT
There are some important things to consider when it comes to tackling your debt. David breaks it down into six points:
Credit scores take longer to dispute, which is why this step comes BEFORE handling your debt.
You need to develop a rent replacement strategy. Your grandparents’ way of doing things is way out of date in today’s economy, so you need to strategize in order to accomplish your home ownership goals.
Get a handle on your debt. This does NOT mean that it all needs to be paid off, but you need to be on the right track.
Understand how different types of debt can impact your credit score (i.e. installment debt vs. revolving debt).
Total debt means NOTHING. Your gross debt and monthly debt have very different implications on your ability to purchase a home.
NEVER consolidate your debt before buying a home.
Ultimately, your debt can be broken down into three categories: good debt, bad debt, and workable debt. Knowing which is which can make all the difference in tackling it. Don’t just take David’s word for it. There are countless stories of How to Buy a Homies in unique situations who learned this knowledge and successfully bought their first home. 
[01:15:57] SAVINGS
Okay, now we’re on to savings. Doing this at the same time as managing your debt means one thing: you need some professional guidance here to make sure you’re on the right track. The bank has very specific criteria and having everything paid off is NOT a part of it. Here’s what you need to consider when saving according to David:
Start saving! Yes, it’s just that simple.
The rest? Well, that totally depends on you and your situation. No one can tell you much salary you need to make, how much you need for a down payment, or anything of the like. But, having a professional can definitely help you along this process.
If you’re terrible at waiting for answers, David does give you a VERY GENERIC low standard to shoot for when saving for a home: 8%. That means 5% for the down payment and 3% for closing costs. However, there are 1000 other factors to consider which is why having a professional guide is key.
David shares some saving success stories from real How to Buy a Homies so you can get a real-life perspective on these all play together.