What If You Can’t Afford to Buy a Home in Your Area?

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Mortgage and Lending with FHA, VA, Jumbo, Downpayment Assistance, Conv. NMLS #276329

Home prices have been steadily increasing, especially throughout the pandemic. In several markets, prices were already high to begin with, leaving many buyers wondering if they’ll ever be able to afford a home in their desired location.

Not all is lost, though. Regardless of market conditions, which are always bound to fluctuate, there are steps you can take to set yourself up for success. We’re here to help you develop a winning strategy that will work for your situation and help you overcome the challenges of a high-priced home market.


Save For Your Down Payment

Regardless of market conditions, it’s always a good idea to have funds saved up for your home purchase. For most loan programs, you’ll need to put some amount down, even if you’re using a first-time homebuyer program that only requires a small percentage for the down payment. If you’re able to finance with a USDA or VA loan, where you don’t need to put any money down, having a healthy amount of savings banked for your home needs will put you ahead of the curve for homeownership budgeting, including maintenance and upkeep.

By planning for your homeownership goals early on, you can build up a sizable savings fund, which can be a big help in high-priced markets like we’re currently experiencing. And, if prices begin to drop, then your savings can go even further, making it a win-win.

 

Consider Properties That Can Generate Rental Income

As you tour homes and narrow down your search, don’t overlook properties that come with built-in income. A duplex, or even a larger single-family home that allows you to rent out the basement or other rooms, could end up being the make-it-or-break-it option that helps you achieve your goal of buying a home.

Lenders will typically take into account potential rental income when calculating how much they can approve your loan for. Depending on the type of loan you’re applying for, there will be different guidelines for how that amount is calculated and any documentation you will be expected to provide.

 

Coordinate A Joint-Purchase with Family or Close Friends

Chances are high that you’re not the only person among your family or close friends looking to buy a home for the first time. One option to consider is pooling resources on a joint purchase. While it may not be the home purchase you initially envisioned, it can be a great interim solution. You might be hesitant about purchasing a home alongside someone who has a close personal relationship with you because you don’t want this to drive a wedge in that connection.

 

Focus on Properties in Your Budget

Once you’ve established a budget of what you can afford and determined how much you can qualify to finance, focus on searching for properties in that price range. If you were initially aiming to purchase a single-family home, this might mean adjusting your buying strategy to include townhouses and condos. Being open to adjusting your expectations can make a difference in achieving your dream of holding those keys to your new home.

 

Utilize State Bond Loan Programs and Grants

Many state housing authorities offer special loan programs targeted at solving the problems homebuyers may face, from mortgage affordability to saving enough for a down payment. Thanks to down payment grants, closing cost assistance, and mortgage tax credits, which are the cornerstones of many of these special loan programs, these mortgage options can become the missing link that helps you bridge the gap.

 

Source: https://bit.ly/3j56dKr

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Lisa Perry, Senior Loan Officer

"Your Northern VA Mortgage Specialist"

540-273-2733

NMLS ID #86548 / 276329

Email:  LPerry@fhmtg.com

Apply on line:  LisaPerrryLoans.com

 

 

 

 

 

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Comments (1)

Matthew O'Hare
Osterville, MA

All very good options. Sometimes a real estate purchase should be seen as a business opportunity and treated as such instead of the realization of a personal dream.

Oct 15, 2021 07:33 AM