Renters finding homeownership more achievable

Renters finding homeownership more achievable

Renters finding homeownership more achievable
Record low mortgage rates have made the transition from renting to homeownership easier than before. By locking in a low rate on a home loan, renters can achieve a similar monthly mortgage payment to what they were paying in rent. The struggle for many renters, however, remains coming up with a down payment.

According to a recent post from the National Association of Realtors’ Economists’ Outlook blog, 38 percent of renters can afford to purchase a home but would need over a decade of savings to come up with a 10 percent down payment.

Fortunately, low down payment programs like an FHA loan allow home buyers to purchase a home with as little as 3.5 percent down. A smaller down payment may cause monthly payments to increase but qualified buyers can find some of that increased cost offset by locking in a low mortgage rate.

Today, conforming no-point 30-year fixed mortgage rates are averaging 2.875 percent and 15-year rates are near 2.375 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.