How To Buy A House Now: You Can Do It, Really.

72% of the Millennial age cohort consider buying a home a “top priority.”

But with so many economic obstacles in the way, despite being the largest generation, our home-ownership levels are abysmally low.

Of course, I don’t have to tell you that.

Let’s get on with the article!

(Don’t feel like you need to read the whole thing at once.

It’s here as a resource, whenever you need it.)

Talk To A Lender

A Residential Mortgage Loan Officer (RMLO)

should be the first person you talk to about how to buy a house now.

It seems many people are afraid to do this, because they fear they are not eligible.

(Or you don’t want annoying salespeople calling you…)

Yes, if you contact them, they’re going to call you a lot to ask if you’re ready to buy.
Use this to your advantage.
RMLOs are commissioned salespeople, and make their money when a loan closes.

That means their entire livelihood is based on getting people like you into homes.

Call an RLMO and let them get to work for you.

There are several I work with often that I trust I can recommend, or you can find one on your own.

It doesn’t matter – just talk to one!

They’re going to take your financial situation and mold it into something that works.

The best part is, there is no obligation to use any RMLO that you speak to.

(That phrase, “no obligation,” sounds like BS, but it’s actually true in this case.)

They want you to get a loan just as much as you do, which gets your dream home.

Real estate agents are limited in how much they can advise about loan programs.

We aren’t trained to specialize in how they work, so it’s always best to talk to a lender first.

Here’s a quick breakdown of loan programs. You may find a few that sound good for you.

Touch or hover
around the circles below
for your different options.

Zero Down Payment

USDA

U.S. Department of Agriculture issues these loans for "rural" homebuyers, but in Texas that often means suburban. Check out the map here to see if where you are looking is eligable.

VA

The Department of Veteran Affairs guarantees these loans are available to eligible Veterans, Service Members and select military spouses.

Low Credit Score

Assistance

Know as DPA (Down Paymeny Assistance) programs, a wide variety of solutions are out there to suit your needs.

Seller Financing

Approach this only with an attorney. Interest rates are typically much higher, and your ownership is at risk if you miss even one payment.

Co-signer

A relative or even a very close friend with good credit can share the loan with you. Just make sure it is someone you trust.

Low Down Payment

Conventional

Shoot for this if you can to avoid the monthly private mortgage insurance (PMI) that many other programs require. You can go as low as 3% down, but 20% gets you zero PMI.

FHA

These loans are insured by the Federal Housing Administration. You can put as little as 3.5% down if you qualify by having little debt compared to your income.

HomeReady

This loan program offered by Fannie Mae allows you to put as little as 3% down if you qualify, and you can even take their online course to help your chances.

Piggyback

One way to avoid smashing open the piggybank is this option, which lets you break up your mortgage into smaller ones so you can avoid that pesky private mortgage insurance (PMI).

Get A REALTOR®

← Shameless self promotion. Yeah, that’s a picture of me.

What’s important though is you should now be pre-approved!

That means a lender has gone over your basic finances and is like:

“Yep, this person can very likely buy a home.”

It’s basically like getting your driver’s license.

Well, more like a learner’s permit.

You’re not approved yet.

But we can drive around and go house shopping! Woo-hoo!!

(Also, make sure you get pre-approved, not pre-qualified.)

The latter means less work for the lender upfront, and many sellers won’t touch them.

Be A Hero

The world needs heroes, and not necessarily those with superpowers.

The State of Texas Homes For Texas Heroes Program can help you get into the home you deserve.

Go The Distance

Dallas has never really been a “city” city…

Sprawl is the name of the game.

Maybe you grew up in a certain part of town.

Or you got a new job and it’s somewhere near, in or around downtown.

Or maybe you’re still looking.

Dallas doesn’t have a “center,” it has multiple centers spread out all over the metroplex.

Me personally? I probably go to downtown Dallas just a handful of times in a year.

Suburban areas such as McKinney, Plano and Frisco boast the infrastructure for international firms.

Beyond that, DFW is expanding in every direction.

They say “Location, Location, Location.”

Use your favorite Map app to estimate your commute time. You may discover you have much more affordable options.

Start Your Property Search Now.

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Keep Watch

There’s a lot in between a house and a home.

Have your Realtor set up all kinds of automated searches for you within your target price range, areas, house types, etc.

Something may come up on the market suddenly and then you’ll have the chance to snap it up.

A more specialized Realtor as well can help you keep an eye on local announcements for foreclosures and other great deals.

You should also not discount older neighborhoods, as many are ripe with “flipper” type investors.

You can get a dazzling home that looks brand-new, and often has a lot of character compared to modern ones.

Just be sure you and your Realtor approach the purchase knowing these sellers are often savvy.

Spec It Out

One of the best kept secrets in real estate is “spec” (speculation), or inventory homes.

These are homes already or nearly built to completion by home builders.

Sometimes deals fall through, so the builders just sit on these perfectly good homes.

Since they’re sold on the open market, a Realtor can get you a great price that’s lower than the typical builder’s premium.

As long as you aren’t particular about design choices, you can get a great deal on a brand new home this way.

Less Is More

Necessity is the mother of invention.
Rising home prices combined with open-minded youth has added innovative housing to the traditional formula.

Buy some land, and it’s yours to do as you wish. As long as you’ve got WiFi there’s no limit on where you can go.

Tiny Homes are a bonafide trend, and since our lives are increasingly mobile many find you don’t spend so much time inside your home, anyway.

Shipping containers can be retrofit into a home for costs as low as $40,000.

If you’re artistic, quirky, or just trying to save money, alternative homes such as these could be a dream come true.

Rent-To-Own?

If buying a home just isn’t in the cards right now, you can always rent-to-own.

It’s almost exactly like buying a house.

First of all, you still shop for the house you want to buy. You don’t have to live in a “rental.”

So you can actually get a jumpstart on living in your dream home, even though you don’t own it yet.

Basically, you pay a premium on top of your rent that goes towards buying the house.

Then, maybe several years later when you’re ready, you can put some of that towards the down payment.

I put this at the bottom of the list because it’s the furthest from truly buying a home.

But, it’s much closer than continuing renting, and you can live in a house that still feels like yours.

Home Run

Actually, not quite a home run. (But Home Run is a very apt pun, right?)

More like a base hit – you’re getting somewhere, but you’re not quite home yet.

You’re under contract, we’ve gone through all the inspections, the house has appraised at value, and we’re pretty much just waiting for your RMLO to get the funds ready.

Just like in baseball, now is not the time for early celebration. Watch the ball; don’t steal home.

Don’t make any crazy purchases like boats or cars that will tank your credit score right before closing.

Do that, and I promise I won’t use any more cheesy baseball analogies (but it’s so apt!)

Hopefully this will really help you out, whether you’re a first time home buyer or just looking for something bigger, smaller, or different.

As always, the “Key Meet Door” philosophy is all about making things streamlined and simple for you.

Hope this helps, and feel free to get in touch with any questions at all. I’ll answer your questions and expect nothing in return.

Jonathan Alpart

YOUR Millennial Real Estate Agent from McKinney, TX!

How To Buy A House Now: You Can Do It, Really.