RISMEDIA, April 17, 2010-BBVA Compass recently released a new survey on first-time home buyers indicating that, prior to purchase, a vast majority of first-time home buyers (88%) believe they have accounted for all expenses related to owning a home. Seemingly contradicting that notion, amongst those who had purchased a home in the past 12 months, just over half indicate the expenses were more than they had calculated, causing a change in lifestyle. These results came from the BBVA Compass First-Time Home Buyers Online Survey which polled American consumers about the thoughts, emotions and hurdles related to owning and enjoying a first home.
Regarding potential first-time home buyers, key findings included:
-Nearly one third have anxiety over the affordability of owning a home.
-7 in 10 indicate that the first-time home buyer's tax credit has not truly factored into the timing of when they decide to purchase a home.
-92% of respondents indicate that having additional time before their first payment due date would be helpful.
Regarding first-time home buyers who have purchased a home in the previous 12 months, key findings included:
-51% indicated that the monthly expense of owning a home was more than they calculated.
-Although 7 in 10 respondents said that the unexpected expenditures leveled out over time, another 87% said they changed their lifestyle as a result of the additional expenses.
-Nearly one third indicated that they paid for these unexpected expenditures with a mixture of cash and credit, perhaps indicating a lack of liquid funds.
"Owning a home is still the definition of the American Dream," said Shelaghmichael Brown, BBVA Compass senior executive vice president and head of Retail Banking. "Yet, while the dream is alive and well, the expenses associated with owning a home can be surprising. As a financial institution, BBVA Compass is committed to educating consumers-with clarity and transparency-on the true costs of homeownership."
Also among the findings of the BBVA Compass First-Time Home Buyers Online Survey was information related to the actual process of purchasing a home. Potential first-time home buyers indicated that when looking for financing on their new home purchase, the item that will be most important to them, but likely also the most confusing aspect, is understanding the process. Ultimately, the first-time home buyer is seeking someone who will provide clarity through each step of the process, from loan options to factors that might affect the rate obtained.
Both segments of first-time home buyers were also overwhelmingly in favor of mortgages that allow breathing room between closing and the due date of the first payment. With this financial cushion, the first-time home buyer indicated that they would be in a better position to pay off credit cards and other bills, as well as make some of those unexpected purchases (household items and improvements) that come along with owning a home.
"Obtaining a mortgage can be a very confusing and expensive process, particularly for the first-time home buyer," said Jon Mulkin, executive vice president and director of consumer asset products. "The more clarity, transparency and help in making the financial transition from renter to buyer that banks can provide, the better positioned the consumer will be going into long-term homeownership."
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