There’s no denying the power of the Internet. It can save time and money, and now it’s becoming a routine source of information, particularly among millennials, in the purchase or sale of a home.
More than 50 percent of buyers from all generations frequently used the Internet to search for their home, but that figure jumps to 93 percent for buyers 36 years and younger, according to the National Association of Realtors’ (NAR) 2017 Home Buyer and Seller Generation Trends report. That’s worth noting because millennials (age 18 to 36) represent the largest share of homebuyers (34 percent), and two-thirds are first-time homebuyers.
The personal finance website NerdWallet found most consumers under 36 would prefer owning to renting, but postponed the purchase of a home because of real or perceived difficulties in affording it. That’s where a community bank like Lakeland Bank comes in. Our expert lending staff can explain not only what you can afford and what to expect during the process, but also other factors worth considering when determining the right time to buy a home. And Lakeland has simplified the loan process with prequalification and an online mortgage application.
For those who are ready, there are several options to consider in addition to conventional loans, including mortgages insured by the Federal Housing Administration. FHA loans represent 21 percent of the overall mortgage loan market, with millennial homebuyers comprising 35 percent of its customers. This might be because FHA loans only require a 3.5 percent down payment and typically have higher loan-to-value ratios and lower credit score requirements than conventional loans.
The U.S. Department of Veterans Affairs offers generous borrowing terms to service members, veterans and surviving spouses, often requiring no down payment or mortgage insurance. While the Dept. of Veterans Affairs (VA) has only a few eligibility requirements, VA lenders may add their own additional requirements. According to the NAR, 12 percent of all homebuyers chose a VA loan in 2017, including 20 percent of buyers age 71 years and older.
In addition to available federal homeownership and home-buying assistance programs, there are numerous programs sponsored by state and local governments as well as other organizations that our lenders can recommend to make homeownership more affordable. Lakeland Bank frequently hosts home buyer seminars and other educational events that can provide valuable information about the process. Visit our social media outlets or sign up for our monthly newsletter to get more details on these programs.
If you’re not quite ready to purchase a home, community banks can highlight resources to help you create a budget and set financial targets so you’ll be well-informed and ready to take the plunge when the time is right. During National Homeownership Month, community banks across the nation want to remind you that they help people achieve the American dream. Community banks are an excellent resource for local first-time homebuyers or for current homeowners looking to buy their next home.