Millennials on the housing market: Resources that help seal the deal
BOISE, Idaho (KBOI) —
Millennials are becoming a major force in the housing market, but high rental costs and student debt make it difficult to save for a down payment. Luckily, there are some resources that can help...
Like many millennials, 25-year-old Sarah Bollert was tired of throwing away money on high rent, and wanted to own her own apartment.
"I felt like the rental market was just going to go up in price and I was just going to spend a lot of money without a return on investment," Bollert said.
But even with a steady job, she didn't have enough for the 20 percent down payment, which is the minimum required to avoid high payments and costly mortgage insurance.
Instead, she was able to get a combination of low- and zero-interest loans to help with her up-front costs.
"These programs are really intended to bring people into the housing market who really have the basics in place," said Tobie Stanger, Consumer Reports spokesman. "They just need a little extra something to get them into housing."
More information on available programs Stanger mentions can be found at DownPaymentResource.com.
At the same site there's tools to learn about opportunities for educators, firefighters, and those in other professions.
Low-to-moderate-income borrowers have also been turning to a new mortgage called HomeReady. Applicants can report rent from roommates or tenants as income.
Joan Carty, who helps home-buyers get low- and zero-interest loans, says it's important for counselors to work with applicants so they understand how much they can afford.
"We are pretty straightforward with them because nobody is doing anyone any favors if they put them into the housing market and buy a home, and they can't sustain it," Stanger said.
No matter how you plan to pay for your home, Consumer Reports says first-time buyers should make sure their credit record is as good as possible. That will help you get the best deal, no matter who your lender is.
First-time buyers may also reach out to parents and other relatives to borrow money to buy a house. On that same note, Consumer Reports cautions that these buyers make sure they don't run afoul of IRS guidelines in the process.