When you’re considering buying a home, the conventional wisdom is that you should wait until you have saved up 20% of the price. However, this advice doesn’t account for the many other ways that millennials can buy a home. Making your first-time home purchase more attainable than ever before. Here are some strategies for how first-time millennial buyers can get into real estate:
Conventional wisdom isn’t your only option when you’re in the market for your first home
Conventional wisdom holds that in order to buy a home, you need to have the stability and the income required to secure a bank mortgage. But this isn’t always true when using alternative financing options.
Seller financing or private mortgages often don’t meet conventional credit standards.
A good mortgage broker will be able to recommend various financing options for your specific situation, including:
- A conventional mortgage loan
- A high-interest mortgage with reduced credit score requirements
- Short-term lending options
In addition, mortgage brokers will consider alternative income like rental income and business ventures – not only the standard employee. Alas, some lenders (including the government) may offer special deals for first-time home buyers as well!
Private sales can reduce the price without having to pay realtor commissions.
You can save money by doing your own real estate research and negotiating the purchase of a home directly with the seller. Without using a real estate agent you won’t be paying commission fees. You may be able to get a better deal this way, but there are drawbacks as well. The property you’re interested in might be for sale by a real estate agent who refuses to book a showing with unrepresented buyers. Furthermore, it takes effort – but that’s what you’re going to need to put it in if you want to save on your first home purchase!
Co-ownership is an option to increase the size of your down payment.
Co-ownership is a form of shared ownership between two or more people. It’s a way to increase your downpayment amount by combining funds. It can be a good option if you don’t have enough money to buy something on your own. If you choose co-ownership, it’s important to get a cohabitation agreement if it’s with a romantic partner or a co-ownership agreement if it’s with someone looking to make an investment – or your parents!
A more affordable location might make ownership possible.
If you want to own a home, and renting is an unaffordable option in your area, there are some great alternatives. Buying a home doesn’t mean that you have to relocate. There are so many great benefits to buying your first home beyond actually living in it.
If you’re looking to buy a home, it might be more realistic if you look for an affordable location that has a good rental market. Even if it’s not the area you want to live in! You can then rent out your property and use the money earned from your rental to offset paying for a rental in the area where you want to live. This way you’re building your own equity and wealth but still get to stay in that trendy or upper-middle-class area you love to live in but can’t afford to buy in.
When it comes to buying a home, there are lots of options, so don’t give up!
When it comes to buying a home, there are lots of options. Though it may be daunting when you’re first starting out, don’t give up! As you can see, there are many ways you can make the dream of owning your own home come true.
Don’t Be Afraid To Try Something New
If you want to buy a house but feel like your finances aren’t in the right place yet, there are alternatives. Take some time and do some research on other ways that people have bought their homes without having perfect credit scores or high incomes. You might find that there are alternative lending options available that could help get you into a house sooner rather than later.
Don’t Be Afraid To Ask Others For Help
The truth is property is an amazing investment. There are many people who would be happy to enter into a co-ownership agreement or private lending with repayment options that are guaranteed to pay interest. You can also ask about neighborhoods that have a great rental market (even if they’re not where you want to live!) You can buy a place that’s within your budget and rent it out. Use your rental income to pay your mortgage and part of the place you’re renting!
Conclusion
Whether you’re a millennial looking to buy your first home or not, these tips can help you make the most of your money as you look for that perfect place to call home.
