Many of us think that home ownership is a far off dream that cannot be attained until we are more settled down with a wife and maybe just beginning our families.
The reality is that’s more like the dream of our parents, as we have more and more programs that are available to us to own a home sooner than most of them dreamed of.
I’ve had many clients that have put off home ownership simply because they thought they couldn’t afford it. They’d saved up a very substantial down payment, and had income in excess of more than $65,000 a year.
This client also had no debt – his car was paid off, and had very little credit card debt which was paid in full at the end of every month. In my world, this is a dream client, a client that understands debt very well and is frugal with it and has everything set up to qualify for a home very easily.
For whatever reason, he just didn’t think that he could afford homeownership, when in fact he’s one of the most qualified to do so.
On the other hand I get many first time buyer clients that want to buy a home who don’t quite qualify but are very close and want to know the last few steps to homeownership.
To start we set up an appointment and have a meeting that is tailored to their individual needs as every client possesses their own differences.
Most first time buyers that I meet with have a very good idea as to what they want to accomplish and simply need some clarification on a few of the steps.
They usually earn about $36,000 to 55,000 per year, and have been on their job usually for three to six months and in the same industry for one to two years.
Depending on their income, they may have a small car payment of about $200 to $350 per month and might owe a couple of thousand dollars on their credit cards. Some may have their 5% down payment saved, others may have saved about half and their parents gift them the other half or sometimes the whole amount and others may have no down payment and opt for the lenders’ Cash Back programs.
Many don’t know it but you can actually buy a home by earning as little as $17.20 an hour! This hourly wage at 40 hours a week equates to $35,776 a year, and could qualify you for a $250,000 home if you had a 5% down payment.
With this scenario, you’d have a mortgage payment of only $1,064.07 (PI), plus property taxes of about $167 per month.
The example is based on a super low five-year fixed rate of only 3.89% and a 35-year amortization. If you wanted an even lower priced house you could qualify for one on even less income.
Realize though that this example is based on someone that has no other debts, so if you have a car payment or small credit card debt, then your individual situation may be a little bit different.
If homeownership is something that has been on your mind, reality is you too can own one. You just may need a short meeting to figure out the small details!
Jean-Guy Turcotte is an Accredited Mortgage Professional with his partners at Regional Mortgage Corporation and can be reached at 403-343-1125 or firstname.lastname@example.org or texted to 403-391-2552.