Four tips that can help millennials on the path to homeownership!

Publish Date July 29, 2019

High student loan debt is seen as a major obstacle to homeownership for the millennial generation. A survey by Apartment List found that student debt has been a major factor in millennials deciding to delay purchasing a home, despite the fact that nine out of 10 millennials desire to own a residence.

Although many millennials are delaying the purchase of their first home, that delay may not be as long as many would expect. A survey by Research Now found that homeownership for people ages 28 to 31 increased from 27 percent to 47 percent over the last two years. Additionally, homeownership for people ages 32 to 36 increased from 46 percent to 57 percent over the same time frame.

Kristina Johnson NMLS# 1798175, Assistant Vice President of Retail Loans at Fidelity Bank & Trust, explains some of the benefits of owning your own home.

“There is a lot to consider when choosing to buy a home versus renting a home or apartment. First of all, there is a pride that comes with ownership. Knowing that the home and property is yours is a big accomplishment! When owning a home, you not only have ownership but you are building equity, which in turn is an investment in your future as well.”

To help with your decision-making process, we’ve crafted four tips that can help millennials on the path to homeownership!
 

1. Start saving and reduce your debt. The sooner you start saving, the better position you will be in when you are ready to buy a home. Consider opening a first-time homebuyer savings account that will allow you to claim a credit on your state income taxes.
 

Pay down as much of your existing debt as possible. Doing so may make budgeting for a future mortgage payment less stressful. It will also strengthen your credit history, allowing you to qualify for a better interest rate when you’re ready to buy.

“Buying a home is a big decision,” says Johnson. “As a young person planning for your future, you should consciously make a decision to set aside and start saving for your down payment and closing costs in advance, pay down existing debt and stick to your budget. This will put you in a much better position when you decide to start looking for your dream home!”

2. Get pre-approved for a home loan. Once you’re ready to enter the housing market, look into your financing options and start the approval process for your loan. By getting pre-approved, you will have a solid understanding of what type of home you can afford, and it will eliminate that step when you are ready to make an offer.
 

3. Calculate additional expenses. As you budget for your mortgage payment, it’s crucial to consider other expenses that come with buying a house, including property taxes, insurance and closing costs.
 

4. Stick to your budget. Once you know what you can afford, stick to it. Don’t look at homes way outside your budget. And if a seller is unwilling to meet you at a price that you are comfortable with, walk away.

“Fidelity Bank & Trust has many different real estate options that can fit most anyone’s financial situation, whether you have a small down payment or you have a large down payment,” explains Johnson. “We will listen to you, and what your wishes are for the future, and will try to help you succeed in your goals. The best part of my position as a lender is to see someone take the key to their new home!”

At Fidelity Bank & Trust, our mortgage center process is personalized and easy. Click here to view rates, apply today and learn more about purchasing your dream home with your Hometown Bank!