Millennials, or people between the ages of 19 and 37, have been a driving force in today’s real estate market. In 2017 millennials were the largest home-buying generation (34 percent) since the baby boomers at 30 percent.
However there still are millennials out there that are renting. They fear they can’t afford mortgage payments due to crippling student loan debt or they find it nearly impossible to save for a down payment. If you or your loved one is considering homeownership for the first time, here are some tips on how to secure a loan with good terms, lower your down payment and purchase the best home for your budget.
Get Your Credit In Order
If your credit score is less than desirable, this is the first thing you need to address. In fact, even if you’re not shopping for a home or you know you won’t be ready to buy for another year or so, a low credit score will cost you more money on car payments and other loans. Take steps to repair your credit now so you can lock in the best mortgage rate and loan terms.
Learn More: 4 Credit Mistakes Michigan Homebuyers Make
Get Pre-Approved from a Mortgage Lender
Before you start looking for a home, you should get pre-approved for a loan. Failing to do so could result in a huge disappointment when you fall in love with a property only to find out it is out of your price range that you are approved for. It also gives you a competitive advantage over other buyers that haven’t been pre-approved as it shows the seller that you can afford the property you are looking at.
Shop by Payment, Not by Price
A pre-approval will help you get an idea of what you can afford. You should also put together a monthly budget. Being realistic about what you can afford every month will help you find a home within your budget and live comfortably. Be sure to include every expense from the cable bill to the cup of coffee you buy in the morning. How much is left over to contribute to a mortgage payment every month? Don’t forget to include costs for maintenance and future home improvements.
Take Advantage of Down Payment Assistance
Did you know that there are down payment assistance loans available? Many buyers have no idea these programs exist and they are leaving money on the table. For example for a limited time only, there is a Step Forward Program that pays up to $15,000. MSHDA loans will provide up to $7,500. There are also Rural Development loans that offer 100% financing. If a down payment is the only thing holding you back from the home of your dreams, you may be closer to home ownership than you think!
Learn More:
Step Forward Down Payment Assistance is Available for Michigan First Time Buyers
3 Michigan Down Payment Assistance Programs That Are Helping Buyers
About Michigan Mortgage Lender, Julie Krumholz
Julie Krumholz is has been helping Michigan homebuyers for over 30 years and has several loan programs available to accommodate various needs and budgets. She brings a wealth of experience to her clients and nothing makes her happier than seeing the face of a happy and excited customer at the closing table.
Call Julie from Superior National Bank today at: 586-382-5482 and let her help you navigate through the loan process and answer any questions you may have.
