Down Payment Options for Millennials
Posted by jamella in Tips and Advice/ on March 11, 2019
If you were born between 1981 and 1996, you’re a part of the generation known as Millennials. And according to recent studies, buying a home is on your mind, but the biggest barrier to achieving this goal is finding the money for a down payment.
You’re not alone. 89 percent of Millennials want to buy a home, but almost two-thirds (62%) believe they can’t afford the down payment. And, at the rate Millennials are saving, it will take them at least a decade to be able to purchase a home. 48 percent have not saved anything for a down payment on a home.
That thought can make you want to go right out and indulge in some retail therapy!
But what if this barrier is not really such a problem?
Some young adults are finding ways to overcome this hurdle and buy a home – the 2018 Home Buyer and Seller Generational Trends study from the National Association of Realtors reports that Millennials bought more homes than any other age group.
So how did they solve the down payment problem?
Down Payment Options
The ApartmentList.com study on down payments shows that many Millennials get help from their families. If you’re not in a position to get that kind of help, there are several down payment assistance programs available in Southern California.
The vast majority of first-time home buyers in California aren’t aware of these programs and, as a result, millions of dollars in down payment assistance, or closing cost assistance programs, go unused each year.
That’s right, millions of dollars.
You could tap right into that money and buy your first home.
There is just one drawback – California down payment assistance programs and grants can be a minefield of confusing information. You’ll need to work with a realtor or mortgage broker who knows the plans and programs like the back of her hand and can find the right one for you.
Will you qualify for these down payment assistance programs?
There are several qualification requirements to access these programs. But the good news is, you probably will qualify.
One is your income level. Check out the limits for Southern California counties here https://www.calhfa.ca.gov/homeownership/limits/income/income.pdf
The sale price limit for 2019 statewide is $765,000, so there’s no shortage of homes you can pick from.
Then there is your credit score – but it doesn’t have to be as high as you might think. 650 will do just fine. One thing to keep in mind is that these program providers don’t deal with the public directly. Mortgage decisions are made by their preferred loan officers and approved lenders.
If you’d like more information about down payment options and programs, give us a call. We can help.