Making Home Ownership A Reality When You Have Student Loans
Do you have student loan debt and want to buy a home? If so, you may be worried about how your student loans will impact you qualifying for a home. It is possible to get a home with student loan debt. The following are a few points to keep in mind as you work towards your dream of home ownership.
Reduce other debts.
It is not unusual for college students to create other types of debt. For example, credit cards and auto loans are two types of other debt. Paying these other debts off will "free up" more money for you to put towards your downpayment on a home. The extra money could also be used to lower your student loan debt.
Pay student loans on time.
By paying your student loans on time, you will protect your credit. It also shows potential mortgage lenders that you are financially responsible. If you default on your student loans due to non-payment, your dreams of owning a home could be delayed.
Come up with a down payment savings plan.
If you are close to graduating from college, you can inform family and friends that you want to buy a house. You could request that they give monetary gifts, which you could use towards your down payment. Perhaps you have graduated and started your career. You may be able to save up for a down payment sooner by taking on a second job and using the money from it to add to your down payment savings. You can also check to see if you qualify for down payment assistance programs in your area.
Search for homes you can afford.
Consider living in a nearby rural area. Working with a real estate agent will give you access to more homes than you can likely find on your own. It is possible that they will know of homes for sale that fit your budget. They might also be aware of other housing options such as condos for sale. You could also consider focusing on this as a starter home rather than a dream home. This means that you may get a smaller home for now especially if you do not have a family.
A real estate agent is a good resource to use to find homes that might fit your budget. They can also offer you further insight on things you can do to improve your chances of getting approved for a home despite your existing student loans.