June is Homeownership Month: How To Afford a Home in Today’s Market.
The American Dream of homeownership can feel increasingly out of reach with rising home prices. In some parts of the country, prices have surged by as much as 8%. But don't be discouraged! June is National Homeownership Month, a time to celebrate the path to owning your own home and explore the resources available to make it a reality. With a strategic approach and a knowledgeable mortgage broker by your side, you can turn that dream into a tangible goal.
Pay off debt & increase your credit score
Some might say to wait to buy a house until you're completely debt-free. With car loans, student loan debt, and credit cards, this is a bit unrealistic. Check out my video on why having some debt is important when applying for a mortgage loan. We do believe you should follow the 30-70 utilization rule, which is utilizing no more than 30% of your overall credit. Lowering debt is possible and doing so can increase your credit. Here are some tips. Many struggle to afford homes because a significant chunk of their income goes towards car loans, student loans, credit cards, or a combination. We advise you to list your debts by balance, not interest rate. Then, throw all your extra cash towards the smallest debt while making minimum payments on everything else. This is called the debt snowball method.
Once your smallest debt is conquered, add that payment amount to your next-smallest debt's payment. Keep repeating until you're completely debt-free!
Find homebuyer assistance programs that you qualify for
First-time homebuyer programs can be a game-changer! Explore federal, state, and local options that offer financial assistance, including grants, loans, and tax incentives. Many programs specifically target lower-income families, aiming to make homeownership attainable by easing the burden of down payments and closing costs. Check out resources like the California Housing Finance Agency (CHFA) for program examples.
Explore affordable options!
While achieving complete debt freedom is fantastic, there are other ways to make homeownership a reality. Consider searching for houses in more budget-friendly neighborhoods or looking at smaller properties that better suit your financial situation. Many desirable areas offer hidden gems, and with some research, you can find a home you love that fits your needs.
Get a savvy mortgage broker on your side
Mortgage brokers can be powerhouses when it comes to finding programs that make buying a home more affordable. Here's how they can help:
Program Expertise: Mortgage brokers aren't just loan processors - they're well-versed in the ever-changing landscape of homebuyer programs. They can guide you through the maze of federal, state, and local options, including:
First-time Homebuyer Programs: These programs offer grants, loans, and tax incentives specifically for first-time buyers.
Down Payment Assistance: Many programs help bridge the gap between your savings and the down payment requirement.
Low-Income Buyer Programs: These programs often offer lower closing costs and relaxed qualification requirements for income-eligible buyers.
Matching You to the Right Program: A good mortgage broker will take the time to understand your financial situation, goals, and location. Then, they can match you with programs that best suit your needs.
Streamlining the Process: Applying for these programs can involve different requirements and paperwork. A mortgage broker can help navigate the process, saving you time and frustration.
Negotiation Leverage: Having a pre-approval letter that factors in program benefits can strengthen your offer and potentially save you money on the purchase price.
Brizzi Financial Helps Beyond Programs
At Brizzi Financial, we will also look at your overall financial picture. We can help you develop a budget and explore different loan options to ensure affordability in the long run. At our core, Brizzi Financial is committed to empowering individuals to make informed financial decisions that serve their best interests. Our approach emphasizes transparency, personalized guidance, and unwavering support throughout every stage of the financial journey. We recognize that financial well-being is not about us—it's about you, your aspirations, and your peace of mind.
Please reach out to us so we can discuss what can work for your financial plan.