It's a rather safe assumption that most people, especially those reading this, have either purchased a home, or would like to in the future. If the latter is the case, this article might just convince you to pull the trigger on becoming a new homeowner.
It’s the American Dream to own a home, and to be in control of one’s finances. But more than that, it is actually cheaper to own your own home, than to pay rent.
This is because paying rent usually means that you are paying the homeowner’s mortgage, and a little extra. Many people understand this, yet there are many who continue to pay rent rather than own a mortgage.
While reasons for not owning a home can vary, there is one which is very common among millennials. It is rather simple, and something that many who have sought to purchase a home have run into in the past.
Down payments can be EXPENSIVE!
Consider for a moment, the cost of putting 3% down on a $200k home. The down payment would be around $6000 dollars, which is much more than many people have saved in their bank accounts. Especially if they are living from paycheck to paycheck! For many Americans, this is a bit out of their price range.
But, did you know that some lenders are willing to gift borrowers 2% of the down payment? This leaves just 1% of the down payment left for the potential homeowner. In the case of a $200k home, that would be just $2,000. For many, this is around the price of 2-3 months’ rent. Depending on the price of the home you decide to purchase, this number could obviously be much lower.
So, how does it work? And why would lenders be so willing to gift 2% down?
Depending on credit history, income, and other factors, some lenders are willing to front the 2% down payment to incite home ownership, while the borrower benefits from having to put hardly anything down, the lender benefits from having more borrowers.
If the only reason you aren't currently living in a home you own, is because of the down payment, it might be time to consider making the purchase. Two months rent, that's all you're going to need.
If you would like more details on how this can work for you, please feel free to give us a call anytime!
