Homebuyer Tips For Recent Graduates | There’s Hope!

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Buying a home with student loan debt: 2 big myths, busted

Buying a home with student loan debt: 2 big myths, busted

Buying a house when you’ve got student loan debt: impossible? Plenty of news reports make it sound that way. If you’ve given up on buying a home before you’re a grandparent because you think you’ll never save that 20 percent down payment and you’ll never qualify for a loan, keep reading. You might well be wrong.

We say that after talking with someone we figured should know: Kathy Cummings, senior vice president of homeownership solutions and education executive at Bank of America. She works nationwide with nonprofits like Framework on preparing people for homeownership. The light she shed on this seemingly dark situation left us feeling a lot more optimistic.

Don’t believe everything you read

“There’s a lot of misinformation out there,” says Cummings, especially on the Internet, which younger homebuyers are most likely to rely on.

“That’s where I get my news too,” she says. “I like my information right away. But when I read articles that have misinformation about what it takes to get a mortgage or what it takes to buy a home, it just frustrates me because I know that it’s not accurate. There are options out there.”

Myth No. 1: You need 20 percent down

“With FHA [Federal Housing Administration], you can have as little as three and a half percent down,” Cummings says. “And it doesn’t have to be your money. So if you can qualify for a first-time homebuyer program, it’s not necessarily money you saved.”

Definitely do not limit your thinking to federal programs, Cummings says. Among those first-time homebuyer programs she’s talking about are local ones that you’ve probably never heard of. Many municipalities are working to generate affordable housing for first-time homebuyers. “I guess it’s one of the best-kept secrets,” she says. “A lot of cities have special programs for first-time homebuyers where you can get some closing cost assistance or down payment assistance.”

Her best advice: get yourself to a housing counseling agency. You can search for one at HUD.gov. If you go to one in your city, Cummings says, they will more than likely know about those “secret” down payment assistance programs. Your local housing authority is also worth a call.

Myth No. 2: It’s hard to qualify for a mortgage loan

Not necessarily true, even with student loan debt in the picture, says Cummings.

“To qualify, you can’t have poor credit,” she says, “but you don’t necessarily have to have to have a super-high credit score either. I think people have in their minds, ‘I don’t have a spotless credit history, so I’m not going to qualify for a mortgage.’”

The most widely used credit score is FICO. It ranges from 300 to 850 and gets calculated based on the information in all three of the major credit bureaus’ reports. Lenders actually aren’t looking for perfect credit scores, by the way—they’re almost impossible to achieve.

“When a lender evaluates you and your credit profile, they’re going to look at you holistically, at everything,” Cummings says. “Everything” means not just your FICO score, but also your income, your earning potential based on your career, how you’ve managed your money in the past, and more. In other words, it’s very much case-by-case. Don’t paint yourself with a broad brush based on reports you’ve seen in the media.

Also on the credit front, you don’t necessarily have to have a traditional credit profile, Cummings says.

“If you don’t have credit accounts, like maybe you haven’t had credit cards, they can look at things like how you’ve paid your rent in the past,” she says. “Usually when you do that, homebuyer education is required to make sure you’re set for successful, sustainable homeownership.”

More programs you probably haven’t heard of can make qualifying easier, Cummings says.

Take mortgage credit certificates. A mortgage credit certificate (MCC), issued by some state and local governments, allows you to claim a tax credit for part of the interest paid on your mortgage. It’s a tax credit, not a deduction, so lenders may count it as additional income, which of course will help you as a first-time homebuyer to qualify for loan.

“And then there are some companies that offer employer-assisted housing,” she says. “Hospitals, for instance. I just heard about a bond program in Jacksonville, Florida, at a large shopping plaza, for anyone who works within that complex, regardless of income. While I don’t know a lot of the details, that could mean low interest rates and good qualifying parameters.”

Those are just a few examples. So we repeat: get yourself in front of a housing counselor. Says Cummings, “If my daughter were to come to me and say, ‘I want to see about whether I could qualify for a mortgage,’ I would send her to a nonprofit housing counseling agency.”

Her daughter. If that doesn’t seal your next step for you, we don’t know what will! Again, you can start your search for a housing counselor at HUD.gov.

– See more at: http://www.frameworkhomeownership.org/blog/buying-a-home-with-student-loan-debt-2-big-myths-busted#sthash.IKhs3TiD.dpuf

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9 Comments

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  4. Figure 7: Pricing and quantity update automatically as you change the specifications on the ProtoQuote. En nuestros taller de mecanizados, contamos con las mejores técnicas y herramientas para la creación de mecanizados de alta calidad. El pago se puede hacer con Visa, MasterCard American Express pago contra entrega (cuando sea posible) El vendedor puede ofrecer pagar en 30 plazos, si las referencias de crédito y el historial son los adecuados.

  5. Vern Taitt says:

    Así que bueno, cabezota de mi, llamo al servicio técnico de Fujitsu Madrid, donde según el dependiente había sido enviado, le cuento el problema a la que me atiende y me dice que el primer año de garantía es de la marca y el segundo del establecimiento donde lo compro, por ley. Y que claro, es mi palabra contra la suya y no tengo forma de demostrar que no ha sido por un mal uso… no si a mi me encanta saltar encima de mi portatil… de todas formas nos recomienda que hablemos con el servicio de atención al cliente del fnac y nos da la hoja de reclamaciones.

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  8. Alane Nobles says:

    Pero si tu modelo no es de esa versión, entonces tienes que colocar las piezas en este orden: Tornillo / Junta de cobre / Chapa resistencia / Junta de silicona / Parte superior de la caldera / Tuerca Y para favorecer el sellado, la tuerca que rosca al tornillo se fija con un poco de pegamento (tipo Loctite). Hola, Ángel, en estos momentos no disponemos de stock de esa pieza pero te informaremos en breve al respecto. Hola soy Francisco el pasado día 13 de Febrero me comunique con ustedes y hasta la fecha no he obtenido respuesta,es sobre el servicio técnico de Santa Cruz de Tenerife,pues ya son 5 meses de espera para arreglar mi cafetera,confio en ustedes,gracias.

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