Get In The Game: Your First Home Purchase

Get In The Game: Your First Home Purchase…

By: Jessica Schirripa | Insider Guide to Millennial Culture

Thinking about buying your first home? If yes, then we understand your stresses!

Between astronomical debts, coupled with the inability to seek loans, establish proper credit, a mediocre job market at best, and the overall delay in social advancement, who can afford shelter with this level of apprehension? You’re scare and I’m scared!

Millennials (ranging from 18-34) are the premium demographic seeking his tips for purchasing and advice when considering buying a first home in 2016. They want to be homeowners, yet have been hesitant to get in the game. There are many reasons for this sudden surge in interest by maturing Millennials. Chris Cabanillas, an expert in the current marketplace, not only breaks down the ailing concerns, but speaks directly to the reassuring ways Millennials can enter the home buying market comfortably.

Chris supports our readers by supplying us with an exclusive interview regarding the efforts, benefits and reasoning behind taking the giant leap into adulthood with home ownership.

TIM: HOW MANY OF YOUR CLIENTS ARE MILLENNIALS? 

CHRIS: I would say about 10% of my clients fall under the category of the millennial age bracket. The average age of a serious, inquiring candidate is approximately 33 years old.

TIM: WHY DO YOU THINK IT IS SO DIFFICULT FOR MILLENNIALS TO TAKE A LEAP AND BUY THEIR FIRST HOME?

CHRIS: Well, many millennials have moved back home as they deal with a sluggish job market and mounting student loan debts to pay off. Jobs are definitely not paying what they used to in an evolving economy where most salaries plateau while basic necessities rise in cost. This makes it very difficult for young adults to really get their feet of the ground. People spend different and take drastic measures in order to save for that one big investment.

TIM: HOW MUCH MORE DIFFICULT IS IT TO GET A MORTGAGE NOW COMPARED TO A DECADE AGO?

CHRIS: I would say it is improving 3%-5% of purchasing. The problem is many up-and-coming prospects know people who have struggled and went through all of the stress already to get a loan for a mortgage. They were shut out cold. After all, only until recent did the marketing lending begin to loosen up. Up until about 2007, Boomers experienced a boom to say the least. Down payments were not a requirement and borrowing money was a seemingly easy expenditure. Until people got burned… Most millennials feel disengaged and discouraged from even attempting until they feel they are truly ready to advance in life.

TIM: WHAT IS THE FIRST THING YOU CAN SUGGEST TO MILLENNIALS IN ORDER TO RAISE THEIR CREDIT SCORES AND BECOME ELIGIBLE FOR A MORTGAGE?

CHRIS: First off, take advantage of understanding your credit monitoring platform. Most people are unaware or read the data incorrectly. I encourage young adults to do what it takes to get in the game early. Build up momentum and equity. Everyone needs to take the appropriate steps to pay on time. However, for some individuals who are frightened of adding more debt, they simply do not use their credit cards and they don’t build up credit. This can essentially hurt you in the long run, even though a person is trying to be fiscally responsible. Time to clean up and get positive approval!

TIM: HOW IS THE MILLENNIAL GENERATION DIFFERENT WHEN IT COMES TO BUYING A FIRST HOME COMPARED TO PREVIOUS GENERATIONS?

CHRIS: One thing is for sure, millennials are really doing their research. This is also why it is taking a bit more time for them. They are reading a lot online, searching and they come in prepared with a lot of questions. Other generations did not have that luxury of accessible and available information. They are really trying their best to understand how the real estate industry works.

On the common side, the generations are traditionally similar in their approach in timing. Meaning, many people begin their quest when they are ready to settle down, get married and start a family. Millennials essentially want just that, but it is happening later for them due to the economic circumstances. For that reasoning, Millennials have not been a huge player in the housing market until they’re more sustained and comfortable in their 30s. Never underestimate the power of a duel income or partnership.

TIM: DO YOU FORESEE A BREAK OUT EVENT OR DEMAND MADE BY MILLENNIALS THAT MAY TRIGGER A MORTGAGE BOOM?

CHRIS: Millennials are definitely under a lot of social and economic pressure to get out of their parent’s homes sooner rather than later. However, it is a trade-off. There is so much more to consider when making the leap- cost wise. There will always be a demand for this reason, but the good news is because so many young adults are choosing to live home longer, they have more in savings to eventually move forward with a purchase. 

TIM: WHAT IS MOST IMPORTANT WHEN BUYING A HOME? IS IT A LARGER DOWN PAYMENT OR THE ABILITY TO CARRY YOUR MORTGAGE 15-30 YEARS? PLEASE EXPAND ON THE MOST CRITICAL FACTORS FOR MILLENNIALS TO CONSIDER.

CHRIS: As mentioned above, the off-set expenses growing in a person’s bank account from living at home can go towards a sizable down payment- bringing their monthly spend way down as they carry year to year.This is an opportunity for millennials to budget accordingly, which is a crucial factor for homeowners starting out. I would also recommend not getting too “sticker shocked” when an individual sees the grand number. Again, a significant down payment will benefit tremendously, something previous generations could not afford. By getting in the game early (which I can’t stress enough), you can advance and upgrade easier. Plus, who doesn’t want a tax break where they can get it?

TIM: EXPLAIN SOME STRATEGY REVOLVING AROUND THE IDEA OF RENTING VS. HOME OWNERSHIP?

CHRIS: A most frequently asked question for sure. There are pros and cons to everything. While renting, people feel they are just throwing away their hard-earned income with nothing to show for it, a home is an investment. On the flip side, with property comes more responsibility. I believe you experience the most benefits by entering the ownership market as early as possible for all the reasons mentioned above. GET IN THE GAME!

TIM: CONDOS VS. HOME PROPERTY?

CHRIS: Know your budget. Then come up with a solid plan. Then you must begin your research. Most people start researching before anything else. I know it’s fun to shop online, but until you have the facts, figures and numbers all worked out in your head, you will not know what your best options are- co-op, apartment, condo, or home in the ‘burbs…Maybe even a penthouse suite if you have it like that- I don’t know(LOL). Just try to keep the proper steps in order and the rest will fall into place. 

TIM: WHAT ARE SOME OF THE SOCIAL, ECONOMIC AND CULTURE TRENDS HAPPENING IN THE MARKET TODAY? DO YOU FIND MORE MILLENNIALS ATTEMPTING TO LIVE CLOSER TO THE METRO AREA OR WHEN THE TIME COMES, TO MOVE FARTHER WAY?

CHRIS: Location is always a huge factor when it comes to pricing and costs- especially in the NY Metro area. However, despite the obvious inconvenience of over the top expenses, millennials want to stay in the city! They are working tirelessly to figure out a way to maintain a lifestyle where they work, play and where all of the action happens. At first thought, most people would believe the farther they stray, the cheaper the cost of living will become. However, when allocating the added commute time, plus gas, tolls, wear & tear- mentally and physically, the balance shifts to an explosive burden. Millennials really think about all aspects of their options. The trend remains, Millennials will always gravitate towards high-volume areas.

About Chris Cabanillas

Chris Cabanillas, founder and CEO of the highly-accredited firm, ‘Cabanillas & Associates’ is a mortgage and foreclosure specialist with 10-offices widespread throughout the NY metropolitan area. Chris can be regularly seen and heard on network radio and TV including appearances on Fox Business, WABC-TV, WCBS-TV and other popular programming. As an attorney at law with significant experience in real estate development, finance, acquisitions, sales, foreclosure defense, and loan workouts, Chris is one of the most sought after experts in this target field. He often provides supremely valued insight into the competitive mortgage industry, converting renters into homeowners whiles establishing and improving opportunities for investments.

 FOR MORE INFORMATION, TIPS, AND ADVICE FROM THE EXPERT HIMSELF, PLEASE CONTACT CHRIS CABANILLAS…