Are you a renter? Are you due a tax refund this year? What if you could take that refund and use it to help purchase a new home of your own.
As rental rates continue to climb many renters are seriously considering purchasing a home of their own. Whether you rent or own, your monthly payment is paying somebody’s mortgage and building someone’s net worth. Shouldn’t it be yours?
According to the Federal Reserve’s “Survey of Consumer Finances”, in 2013, homeowners had a net worth 36 times greater than that of a renter ($194,500 vs. $5,400). The National Association of Realtors® Chief Economist Lawrence Yun predicts the gap will widen even further in 2016.
Are you one of the many renters watching as real estate prices go up and hoping you’ll be able to purchase a home before it gets much more expensive? You probably also realize that today’s low (below 4%) interest rates won’t last forever. What is holding you back from becoming a homeowner? Are you concerned that your credit score is too low, or that the required down payment may be too high?
If your credit score is 620 or higher and you have paid all of your bills on time over the past year, there is a good chance you will qualify for a mortgage.
Don’t have a large down payment? There are a number of loan options available. The FHA has loan programs with down payments of 3.5% for first time homebuyers. Fannie Mae and Freddie Mac have options as low as 3%. There is one Wilmington lender that is offering a 100% loan at a 1.99% fixed interest rate with no mortgage insurance. The only “string attached” is your income must be under $50,000 a year. (It’s a limited program, so don’t procrastinate.) For those that qualify, the USDA offers 100% mortgage loans, as does the VA.
What about closing costs? Consider this: over the next few months approximately 80 percent of Americans will receive a tax refund. The average amount will be roughly $3,000. For some it will be much more. That could be the extra money you need to go from renter to homeowner.
So if you are tired of your monthly rent going up every year, and are ready to start making smart money moves that will help build your future net worth, it makes sense to ask, “Is now the time to buy my own home?”
To be clear, not every renter is ready for home ownership, but I can help you determine if it makes sense in your situation.
If you are in the market to buy a home or just considering your options, it costs nothing to learn more. Call or email Linda for a free, no-obligation, no pressure consultation – 910.409.3519, Linda@LindaMehner.com.