When was the last time you actively looked into trying to get a home? Do you think you can’t afford it? Are you a single parent just looking to “get by” and pay bills.Of course, its tempting to just focus on those bills each month. However, you should not have to reduce your dreams for short term goals. Single parent home buying programs are available to those who qualify.
It may be shocking to believe, but there are advantages to owning a home besides living the “American Dream”. Also it is about a financial well being for the future. At the end of the day, sometimes the biggest advantage to a roof over your head is providing stable housing for your family.
Weighing Your Options
Sit down and really see if owning a home is the right move for you and your family. Remember, owning a home is more than just the mortgage payment. There is insurance and property taxes, home maintenance costs and the cost of any expensive repairs. It makes alot more sense to buy a home when you know you are going to be in one area for a long time.
Pros & Cons
It may be old fashioned, but get out a piece of paper and write your own pros and cons list. Some people want to own a home because it gives them a sense of independence and financial success. Whatever your list is, It needs to be a list that is made for you personally. After you make it, see if you still see a value in this journey.
Don’t be discouraged if this is something you can’t do right away. We have worked with tons of clients who are not ready, but have taken advice from our office and eventually get qualified to purchase. This could be a goal you set by the end of the year or in a few months.
Single Parent Home Buying Programs
Don’t lose hope. There is programs out there that exist for people in this type of situation.
Four Options to Consider
(1) Federal Housing Association (FHA)
Is federally funded and can provide a loan to people who are having a hard time coming up with a down payment. It may be a lower down payment, but be careful with the insurance that comes with it. FHA mortgage insurance is there for the life of the loan. While private mortgage insurance drops off at 20% equity and once requirements are met.
*IMPORTANT: private mortgage insurance (PMI) is on a conventional loan that is added on when you don’t put 20 percent down.
*REMEMBER: The insurance premiums on the FHA loan almost always ends up costing more during the life of the loan ( it does not come off unless you refinance). If you are only planning on being in the home for a few years, the FHA loan might be a better option however.
With so many options of loans, its important you speak with your lender who can lay out every single option for you and run comparisons. This is something you want to let a professional handle. At EGA Homes, we have an in-house lending expert from US Lending Network. He has worked with lots of our clients and works right out of our office. Call our office today if you want to talk about your loan options.
(2) HUD Homes
Visit portal.hud.gov to learn more about HUD homes and how they are a benefit to low income home buyers.
(3) Habitat for Humanity
Is a non profit organization that works with low income families to afford a modest home.Click here for their website.
(4) Individual Development Account (IDA)
This program helps families save for the dream by matching funds greater than what you put in. More information can be found on their website.
…the Individual Development Account (IDA) initiative, which is supported in part through the Assets for Independence (AFI) program at the Administration on Children and Families (ACF), an office of the U.S. Department of Health and Human Services. IDAs encourage and reward savings by the low-income households—starting with as little as $25—which are matched from dollar for dollar to as much as eight to one, depending on the individual program. IDA programs with AFI funds allow the savings to be used toward a first home, post–secondary education, or to start a small business. Participants may also be required take financial literacy and asset-specific training, such as homeownership classes.
What should the goal be? The goal you should be to talk to someone who can give you more information on all the single parent home buying programs listed above. This means you are talking to a lender and proving you are financially stable to purchase a home. Once they look over your documents, they will tell you how much the bank is going to lend you. If that is not possible, they can direct you down the right path on what you need to fix.
Once you get this process done, you can look back at our other blog posts to learn even more information about buying a home and what to look out for. Our website and company is a great tool to learn as much as possible during this process.