Trouble saving a down payment for a house? Press play on your homebuying dream
Jonathan Hartsfield
Bank of America Lending Specialist
Most American homeowners (83%) say they couldn’t go back to renting after experiencing the benefits of home ownership, according to the 2019 Fall Homebuyer Insights Report from Bank of America. Many in our community would like to make the switch from renting to owning but have put that dream on hold, largely due to upfront costs.
Helping prospective homebuyers tackle down payments, closing costs
Many people opt out of home-buying because they think home ownership is beyond their financial power. However, many in metro Detroit can afford a monthly mortgage payment. But what’s stopping them? More than two-thirds of prospective home-buyers across the U.S. say the biggest barrier to owning a home is saving enough money for a down payment and closing costs, according to the Homebuyer Insights Report.
This is why Bank of America introduced a tailored, community-centered program that helps low- and moderate-income prospective home buyers by providing special grants and low down payment loans to help them thrive through the power of home ownership. This $5 billion commitment to home ownership offers down payment grants (no repayment required) of 3% of the purchase price of a residence (up to $10,000); a credit of up to $7,500 that can be used toward closing costs; and fixed-rate loans with competitive rates and down payment requirements as low as 3%, some with no mortgage insurance.
This means eligible home buyers in Metro Detroit could receive as much as $17,500 to help them purchase a home. To see if you qualify, get in touch with a Bank of America lending specialist who can walk through programs with you and discuss your home buying goals.
Falling interest rates and other good news
With 30-year fixed mortgage rates at 3.56% according to Freddie Mac, we’re experiencing some of the lowest interest rates since late 2017, allowing prospective home buyers to lock in very affordable rates.
In addition, home prices have remained relatively stable, with median home prices expected to increase roughly 3% nationally this year and home sales to increase 1% year over year. This is slower and steadier growth than in past years. In Detroit, median home prices have also increased slightly following this trend.
A dream worth pursuing
When you combine reduced upfront costs with today’s low interest rates, the dream of home ownership is becoming possible for many individuals and families in Detroit. The Home-buyer Insights Report found that 93% of home buyers say they’re happier owning than renting, crediting their happiness to an emotional attachment many didn’t anticipate before buying. Seventy-nine percent go so far as to say that home ownership has made them better people, and 76% indicate that buying a home has opened them up to new, fulfilling interests such as cooking, baking, landscaping, gardening and interior design.
Buying a home can seem like a daunting task, causing some prospective home buyers to “press pause” on their home buying dreams without getting a full understanding of their options. Banks are working to make home buying more accessible, recognizing that many individuals and families have the income and ability to make monthly mortgage payments but are challenged by upfront down payments and closing costs. If that’s your situation, now is a great time to learn more about your options.
Interested home buyers can visit bankofamerica.com/firsthome for more information, contact me directly at jonathan.hartsfield@bankofamerica.com, or stop by the office at 3670 Woodward Ave, Detroit, MI, 48201.
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