Buying a home has long defined the American Dream. As we celebrate our independence as a country this Fourth of July, we recognize that it has become more challenging for many, particularly young people and first-time buyers, to “buy in” to the American Dream of homeownership.
Tighter lender restrictions and a difficult economy have presented challenges, especially here in our nation’s capital where home prices are significantly higher than in other parts of the United States.
But fear not, American ingenuity will always triumph and the news isn’t all bad. There are several programs out there that will help. The best opportunity is for our veterans. Our government thanks members of our armed forces by offering them “VA loans.” VA loans have become ever more popular with little or no down payment required for our veterans. Although once regarded pejoratively (undeservedly) in the go-go seller’s market, we have more and more contracts than ever with VA financing and it is now one of the hottest ways to buy a home.
FHA loans are another great program available to purchasers who are looking to buy a property. Under this program purchasers can put down as little as 3.5 percent in a down payment for a loan up to $729,000.
Another option that is now becoming more popular again is a mortgage with an “ARM.” So, if you are planning on only being in the property for a short time, you can get a lower mortgage rate for five or 15 years – and the rate will increase after that amount of time if you are still in a home. Though, across the board interest rates are at historic lows even with a conventional loan with 30-year fixed financing.
Over the holiday as you are watching the fireworks or grilling out in your backyard with family and friends, keep in mind that the American Dream is still possible. Even in these tough times we can still achieve the goals that our parents and their parents had for us. All it takes is a little research, smart financing, finding the program that is right for you and of course – a great Realtor!