Saving for a down payment is the largest obstacle first time home buyers in Wayne/Pike County PA face.
This challenge is amplified by rising rents, which makes saving cash harder after paying expenses. When planning to buy a home, high rents & other expenses make becoming a homeowner seem impossible.
Down Payment Misconceptions Among First Time Home Buyers
Surveys show that many believe they need to save upwards of 20% for their down payment.
The “Barriers to Accessing Homeownership” study commissioned by the Urban Institute, Down Payment Resource, and Freddie Mac, states that 39% of non-homeowners and 30% of those who already own a home believe they need more than a 20% down payment.
Only 12% of first time home buyers are aware of low down payment programs (those under 5%).
In a recent Convergys Analytics report, they found that 49% of renters believe they need at least a 20% down payment.
Within Reach For First Time Home Buyers
The median down payment on mortgage loans approved in 2018 was only 5%! Those waiting until they have over 20% may already have enough saved to buy now!
Legislation has been introduced in Pennsylvania to create a first time home buyers savings account program. This program, once approved, will be a tremendous tool in overcoming the challenges to buying a home.
There are over 45 million Millennials (33%) who are mortgage ready right now. This means their income, debt, and credit scores allow them to qualify for a mortgage today! Remember, if you are paying rent, you are building someone else’s equity & wealth. A mortgage payment may be comparable to (or even less than) what you are paying to your landlord.
If your five-year plan includes buying a home, contact me to determine what it will take to make that plan a reality. You may be closer to buying your first home than you realize! If you’d like to talk to a lender, Fred McNeely a mortgage professional I trust to guide my buyers through the entire process, especially first-time home buyers in Wayne/Pike County PA.