The Karlin Law Firm LLP - Business Law Attorney

Providing quality legal services to statewide and national clients in ADA defense, Personal Injury, business and real estate for more than 35 years

Providing quality legal services to statewide and national clients in ADA defense, Personal Injury, business and real estate for more than 35 years

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Barriers to home ownership for younger people

Society may think that young people living in California don’t want to buy a home because it would make it harder to buy other things. However, the reasons why younger people don’t want to buy a home aren’t that out of the ordinary. For instance, many who went through the last recession may be wary about using credit. Therefore, they may not have the credit history needed to obtain a mortgage.

The fact that many younger people have student loan payments could also be pushing them away from buying a home. In some cases, it may not be possible to add mortgage payments to that debt load. It is also possible that student loan payments push an individual’s debt-to-income ratio beyond what is needed to qualify for a loan. Currently, the average student loan debt is $35,000, and that amount may count toward a person’s ratio whether they are being deferred or currently in repayment.

Those who are paying student loans may not be able to save up for the down payment needed to buy a home. Generally, a person needs a 20 percent down payment to qualify. Even if an individual has other down payment options available, it could still represent thousands of dollars that must be put down at one time.

Buying a residential property may be a long-term commitment for an individual. Therefore, it may be worthwhile to consult with an attorney prior to signing purchase contract or mortgage paperwork. An attorney might take care of any issues related to a property prior to closing.

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