If you are a millennial, then you have probably heard someone say that you will never be able to afford to buy your own house. Well, luckily for millennials, this cynical thinking is very far from reality. In fact, studies have found that millennials are now buying more houses than both baby boomers and generation Xers.
Despite the fact that millennials are buying more houses than any other generation, many still struggle when getting a mortgage. If you are considering buying a house or looking to take out a mortgage, this guide is here to help you learn all you need to know.
1. Pay Off Your Student Loans
One of the most important steps that millennials can take to help them to get a mortgage is to pay off their student loans. A home is likely to be the largest purchase you will never make in your life, so going into the process debt-free is important. Paying off your student loans will help you to improve your credit score and improve your standing to get a high-quality mortgage.
2. Save For a Down Payment
The majority of millennials are purchasing a home with a mortgage, and when buying in this way, it is increasingly important to offer a strong down payment. Offering a down payment that is between 10 to 20% will increase the chances of you being offered a mortgage with reduced interest rates. This, in turn, will reduce the amount of money you have to pay and the speed at which you will pay off your mortgage.
3. Find the Right Mortgage
Not all mortgages are created equal; one of the ways to make getting a mortgage as a millennial easier is to apply for the right type of mortgage. As themoneyhub.co.uk explains, there are a wide range of different mortgages on offer in the market. You should take some time to look into the right loan for your needs and your own situations to make the mortgage application process faster and simpler.
Since applying for a number of different mortgages over a period of time can hurt your credit score, it is vital your mortgage score is targeted.
4. Get to Know Your Credit History
The first thing that a lender will do when you apply for a mortgage is to review your credit history, so it is important that you are familiar with your credit history. Before applying for a mortgage, you should spend some time monitoring your credit to make sure that it is both accurate and as impressive as possible.
5. Find the Right Time For You
Buying a home is typically associated with a certain period of people’s lives, which means that when people reach a certain point, they feel they should start home searching. However, just because you reach a certain point in your life does not automatically mean you need to start home searching. In order to find the best mortgage for your own personal situation, you need to think carefully about when the best time for you to start home searching is.