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How To Buy A House When You're Only 23
By NAPS,
North American Precis Syndicate
. New York
,
NY
.
Photo:
NAPS
A low-down-payment mortgage leads to homeownership for a 23-year-old recent college grad. (NAPS) |
(NAPSI)—Amy is a typical millennial: She's 23, she graduated from
college two years ago, she pays $321 in student loan debt every month and she
rents an apartment in downtown Grand Rapids, Michigan. She's a sales manager
for an international food distribution company and volunteers as an English
tutor every week. She loves bike riding, playing her guitar, Saturday brunch
and beer tastings.
One thing, however, is not typical about Amy: She bought a house and will move
in next month.
Why and how did she do that?
Saving money was the biggest reason. "My friend Mike just bought a house
and his mortgage is $300 less than his rent! When I heard that, I was
definitely interested. Plus, I need a tax deduction," Amy said. She
currently pays $1,440 a month in rent.
She already saved enough for a 5
percent down payment. Amy tapped into a financial calculator found at mgic.com/buynow to figure out if she should buy now
or wait to save for a bigger down payment. "My dad really wanted me to
save enough to put 20 percent down. But I showed him that it could take me
eight years to save that much money! In that time, I could build up $63,000
in equity or spend $140,000 in rent payments," Amy explained.
Surprisingly, student loan debt was actually an advantage. Amy has been
conscientiously paying her college loan every month since she graduated in
2015. "My loan officer said that because I have been paying
consistently, it worked in my favor and boosted my credit score. She also said
that I can obviously stay focused and live within a budget," Amy noted.
Credit history started when she was
16. Thanks to her mom's advice, Amy applied for a credit card when she
was still in high school, used it and then paid it off every month. Amy's
credit score is now a highly respectable 771.
Private mortgage insurance (PMI) was
also her friend. Amy explained, "Okay, one of the reasons my dad
wanted me to save for a 20 percent down payment was so I would avoid paying
private mortgage insurance. Maybe I could have put more down but I didn't
want to deplete my savings. What if something breaks in my new house? Or what
if I want to buy a new sofa? So PMI helped me buy my house with only 5
percent down."
Learn More
Could you buy a house now or would it be better to wait? Find out! Go to mgic.com/buynow.
Plus, you can follow the stories of other first-time homebuyers and learn
from their experiences at www.HomeDiggidy.com.
On the Net:North American Precis Syndicate, Inc.(NAPSI)
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