Do you think you’ll be a forever renter? You’re not alone if you do. Research from the Apartment List shows that 18% of millennials plan to rent forever, an increase of 7% from the previous year. In addition, the median age of the average homebuyer now is 45, when it was only 31 in 1981, showing that, at the very least, people are delaying buying a home until they are older.
But does it have to be this way? We don’t think so. Here are three tools that can help you buy a home now instead of renting.
- Tool #1 – The FHA loan. An FHA loan is a Federal Housing Administration loan, so the government insures it. This type of loan makes it easier for people to buy their first home because you can qualify with a lower down payment and a lower credit score. It’s an excellent option for those with a low or moderate income to enter the housing market. There is even an option for FHA loans that allow you to renovate an older home or pay for energy-efficient upgrades to lower your utility bills!
- Tool #2 – VA loans: If you served in the military, you might qualify for a VA home loan, which helps veterans and military personnel buy homes with little to no down payment. Like FHA loans, you can have a lower credit score and often don’t need mortgage insurance. You have to qualify based on your service record, but it’s a fantastic option for military personnel looking to become homeowners. *VA home loan purchases, have options for 0% down payment, No private mortgage Insurance requirements, competitive interest rates, with specific qualification requirements. VA Interest rate reduction loans (IRRRL) are only for Veterans who currently have a VA loan, current loan rate restrictions apply, and limits to recoupment of costs and fees apply. VA Cash-out Refinances are available for Veterans with or without current VA loans. Policies and guidelines may vary and are subject to the individual borrower(s) qualification. Program and Lender overlays apply.
- Tool #3 – USDA loans: If the housing market in your area is too expensive, why not move to the country? The cost of living is cheaper, and you can buy a home with a USDA home loan. A USDA home loan is specifically designed to help people purchase homes in rural areas. These loans have lower interest rates, lower down payment options, and more lenient credit score qualifications!
It may feel more challenging to buy a home now than it was for previous generations. But, on the bright side, the value of homes is much higher now than it used to be. As a homeowner, you’ll generate significant equity by owning your home and avoiding paying high rent, which can help boost your financial security as you age.
If you are ready to start searching for your first home, let’s talk about what your dream home looks like. We believe in helping our clients become homeowners. And we believe in helping you make sure you get into a home you can afford. These mortgage options can help make that dream come true for your family.