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Apache is functioning normally

September 15, 2023 by Brett Tams

A good credit score will make your life a lot easier; it will help you qualify for loans, apartments and even jobs. But you’re not born with a credit history. Much like you have to spend money to make money, you need to borrow money to prove you’re good at borrowing (and paying back your debts). In fact, according to Nationwide, credit scores help insurance companies predict future losses. So, how can you start your credit-building journey? Here are ways new cardholders can build credit.

Understanding Credit Score Perks

Your credit score is woven into almost every area of your life. “Crummy credit can cost you a fortune throughout your life,” explains Matt Schulz, chief credit analyst at LendingTree. “It’s as simple as that. It’ll lead to higher interest rates and fees on mortgages, credit cards and loans. It can keep you from getting the apartment you want. It can lead to higher insurance premiums. It’s a big, big deal.”

There are two main types of credit scores: your FICO Score and your VantageScore. Most lenders review your FICO Score when making a financing decision. It ranges from 300 to 850, with a “good” score starting in the high 600s. It’s calculated based on a variety of factors, including payment history, credit usage, the length of your credit history, and more. The VantageScore follows similar metrics but focuses less on payment history, allowing scores to be generated faster than FICO. Regardless of the type of score, a proven record of responsible borrowing shows lenders that you’re more likely to pay back your debt, and then they can offer you lower interest rates and charge fewer fees.

Related Read: 7 Unexpected Benefits of a Good Credit Score

New to Credit? Here’s How to Build Your Score Quickly

Get a secured credit card. A secured credit card is a great way to build credit from scratch. It works just like an unsecured card, except that you make a security deposit that is equal to the amount of the credit limit. For example, if you deposit $500, your credit limit is also $500. “Consumers love these cards because they’re easy to get and their low credit limits mean there’s no danger of going too wild on a spending spree,” says Schulz. “Banks love them because there’s no risk. If someone doesn’t pay their bill, the bank simply takes the security deposit. It’s a win for everyone involved.” Before applying for a secured card, make sure the lender reports your usage to the three credit bureaus–Equifax, Experian and TransUnion. If it doesn’t, you won’t build credit. Also, check to see if the lender offers an upgrade to an unsecured card.
Make timely payments. Once you have your first credit card–be it secured or unsecured– focus on paying your bill in full on time, every time. Payment history is a big component of your credit score. Each month you pay your full balance on time, you’re proving your creditworthiness. “Think about it like borrowing the car keys from your parents,” explains Schulz. “The first time you do it, they’re not going to let you do much. Once you’ve shown you can handle a little responsibility, they’ll give you more, though. Eventually, they’ll hand over the keys without thinking much of it.”
Use your card often. The more you use your card, the better. The key, though, is to use it smartly. Pick up the check when you’re out to dinner with friends, knowing they’ll reimburse you for their meals. Use it for everyday expenses like groceries and gas. You can even use your card to pay rent, though there will usually be processing fees added on by your landlord. Just remember: Pay the bill in full, every month. You should also never max out your card. Your credit utilization ratio–how much credit you’re using compared to the total credit available to you–is another aspect of your credit score.
Become an authorized user. If you can’t open a credit card yourself yet, become an authorized user on someone else’s account. Ultimately, they will be responsible for the charges on the account, so you need to have a good relationship with this person. Becoming an authorized user allows you to link to this person’s good credit and thus build yours with steady payments.
Apply for a credit-builder loan. A unique way to build credit is to apply for a credit-builder loan. With these loans, you make monthly payments to the lender for a set period of time. The deposits are kept in a savings account or a certificate of deposit. Once the payment period ends, you get the money back, sans fees or interest charged.
Be determined. Building credit can be daunting, but don’t give up. With each passing month, your timely payments will boost your score. Use texts or autopay features to make sure you’re paying your bills on time. Do whatever you need to do to keep at it. Different apps and some credit cards offer estimates of your credit score, but know that you’re entitled to one free credit report every year from AnnualCreditReport.com. Get in the habit of checking your report every year to make sure there are no lingering issues that are hampering your credit-building endeavors.

About the Author

Chris O’Shea is a freelance writer whose work has appeared in GQ, NerdWallet, Esquire, New York Magazine, and more.

Source: credit.com

Apache is functioning normally

September 15, 2023 by Brett Tams

A medical collection on your credit report can be a concern when you begin the process of qualifying for a mortgage. Medical debt is still debt, which means that it can raise your debt-to-income ratio the same as a car loan. The closer you get to 43% (aka the magic DTI cut-off point), the less likely you are to be approved for a mortgage.

More than 35 million adults struggle with unpaid medical debt, according to NerdWallet, and while the debt doesn’t impact your credit score as much as it did before FICO 9 changes, the debt can cause problems when applying for a mortgage. You have three strategies for handling medical collections, depending on how far the debt has gone into the collections process.

Negotiate With the Medical Provider Before Collections

The best option to avoid medical debt hindering your ability to get the mortgage or rate you want is preventing the bill from going to collections entirely. Many medical providers are agreeable to payment plans set over a specified period, such as splitting your payments over a year or paying a certain percentage of your bill each month. Call to discuss your options.

Ask About Financial Assistance

For high-cost medical bills, such as those associated with an emergency surgery, the hospital may have financing programs in place for assistance. The hospital may forgive the medical debt, have grants or other programs in place to cut down your overall bill, or allow you to pay a fixed monthly cost to prevent the bill from going into collections.

Pay Medical Collections

Once your medical bills go to collections, your primary recourse is to reach out to the collection agency and arrange to pay off the debt. Be careful, though. The statute of limitations on medical debt is 3 to 6 years, depending on the state you live in. If you’re near the end, collection agencies may double down on their efforts to make you take verbal credit for the debt or to make a small payment, either of which will reset the clock.

Even if you’re not nearing the end of your liability, you can likely negotiate a payment that’s substantially less than the original medical debt. This is because collection agencies purchase your debt for pennies on the dollar, assuming they’ll be able to collect at least part of the debt. If you can offer them a lump sum, they may write off the rest instead of waiting around for monthly payments. Just make sure you get any settlement in writing.

Medical debt impacts millions of Americans, but it doesn’t have to stand in the way of home ownership. Even if you don’t pay your medical bills directly to your provider or hospital, you can reach out to collectors to resolve the debt before you start searching for a mortgage.

Source: totalmortgage.com

Apache is functioning normally

September 15, 2023 by Brett Tams

But depending on how a lender interprets the guidelines, the client could have gotten his application rejected for not having consistent employment for a two-year period without interruptions, explained Gastelum.

“It really comes down to interpretation of the guideline. One lender could have said, ‘Oh, he was out a week, so it’s interrupted and therefore, the second employment doesn’t work.’ The problem is, a mortgage credit reject (MCR) is kind of like your scarlet letter, to be completely honest,” Gastelum said.

When a lender rejects an FHA application, it discourages the next lender from even reviewing the application because of the extra work the underwriters have to do to override that MCR, mortgage pros told HousingWire.

All FHA mortgage lenders use a system by the U.S. Department of Housing and Urban Development (HUD) called FHA Connection, a database used to insure and generate FHA case numbers associated with the borrower’s home loan application. When the borrower is denied for an FHA mortgage loan, an MCR report had to be created for that denial. That changed on September 11.

The FHA’s announcement in early September to waive a requirement that FHA-approved lenders flag rejected loans in the FHA Connection system is a step in the right direction since declined borrowers don’t have to overcome a stigma, loan officers said.

In a rate-rising environment where it has become more difficult for first-time buyers to get into the market, borrowers won’t have to deal with a file that has an MCR for six months. Even after the six-month period is over, the borrower’s case number would still be attached to his/her social security number.

Demand for FHA loans have risen over the past year to comprise 23.8% of mortgage applications in August 2023, up from 17% from the same period a year ago, according to the Mortgage Bankers Association.

The FHA/VA share in Q2 2023 stood at 22.9% of the entire mortgage origination volume, up from 18% in Q2 2022, according to data compiled by Inside Mortgage Finance and Urban Institute.

Loan officers said that the FHA’s waiver will give borrowers a fairer shot at obtaining financing. Borrowers won’t be subject to lenders’ different underwriting interpretations that could lead to a rejection of their mortgage applications.

“That (MCR) is a subjective stigma based on credit risk tolerance of the particular lender that you went to initially. “This is an underwriting technicality that is unfair and it is a good move to create more fairness,” Billy Taylor, CEO of Hometown Lenders, said.

“We are really happy about this change because it’s going to provide more opportunity for loan officers and is going to provide more opportunity for buyers to get a second chance,” Michael Borodinsky, VP and branch manager at Caliber Home Loans, said.

Overcoming overlays

The FHA credit requirements are strict, but borrowers can get an FHA loan with no credit score. In fact, HUD forbids lenders from declining a borrower’s FHA loan application simply because they lack a credit history.

In such a case, lenders will ask for documentation, including a letter from the landlord documenting on-time rent payments, payment history of utility companies and cell phone or internet provider.

Lenders, however, have overlays – rules on top of the federal rules that were published as lenders need to sell those loans to investors who do not want to buy high-risk loans.

“Those overlays – it could be higher standards, it could be lower debt-to-income (DTI) ratios – still exist on a subjective basis on a lender-by-lender basis. So a borrower not knowing that they could qualify for a loan where their credit score is below 640 or 620 could be subject to a denial and then not realize that they could be approved somewhere else,” Borodinsky said.

Generally, the FHA requires a minimum 580 credit score with a down payment of 3.5% to qualify for a FHA loan. Under FHA guidelines, borrowers with credit scores between 500 and 579 must make a down payment of at least 10%. But they may also face tighter requirements. Lenders may require a lower loan-to-value (LTV) ratio or ask that the borrower make a larger down payment.

Reasons for a MCR vary, said Ted Tozer, non-resident fellow at the Urban Institute‘s Housing Finance Policy Center (HFPC) and the former head of Ginnie Mae.

“It could be low credit scores, or it could be geographics too – maybe they’re in a market that it’s a soft market where they’re looking at home prices that could be falling. Lenders don’t want to tilt their portfolio to one where these 3.5% down payments could very well become over 100% LTV just because home prices fall,” Tozer noted.

Industry personnel frequently complained that FHA Connection often didn’t provide sufficient information about mortgage credit rejects to determine why the applicant was rejected, said Peter Idziak, senior associate attorney at Polunsky Beitel Green.

“It could be the lender’s own standards could be higher or different, or in addition to just the FHA qualifications,” Idziak said.

For a prospective homebuyer, the new waiver should avoid a possible misrepresentation of their actual creditworthiness, JR Younathan, SVP and California state mortgage production manager at California Bank & Trust, said

“The given waiver doesn’t necessarily open new paths to compete as they could have done that previously. It would only open a new path in the instance that the other lender wasn’t willing to investigate the reasons the denial was registered, and instead rejected the loan file/borrower on the fact it existed at all, thus eliminating that ability to compete,” Younathan noted.

Regardless of whether the applicant is walking in to the lender for the first or second time, the lender should be armed with enough financial information to assess the credit risk.

“The lender should be confident enough to know what questions to ask, how to analyze their income, how to analyze all the other risk profiles, it really shouldn’t make that much difference, because they should be in a situation where they should be asking the right questions to really understand,” Tozer said.

Beggars can’t be choosers

Though loan officers are unanimous that the waiver will make FHA loans more accessible for borrowers, LOs interviewed by HousingWire don’t expect it to increase their production volume.

In a highly competitive environment, lenders had already taken that extra effort to approve loans that would’ve been rejected or already rejected from another lender.

“We’re more likely to underwrite a 500 credit score than a big bank who’s saying ‘I don’t want that risky loan in my portfolio. I don’t want I don’t even want to underwrite it, because I don’t want a 500 or 520 or 560 borrower in my portfolio,’” Taylor, of Hometown Lenders, said.

Hometown Lenders would perform a manual underwriting for an applicant with a lower credit score to try to get an approval rather than simply rejecting a lower credit score borrower, he said.

The FHA loan program requires lenders to seek manual underwriting review when a borrower has a credit score lower than 620 and a DTI greater than 43%. According to HUD, borrowers could qualify with a 580 credit score and a DTI of 50%.

“That (loan origination) is the only way we make income. I don’t think it (the new waiver) would affect us at all, we would have looked at that borrower whether there’s an MCR on there or not,” Taylor noted.

To override an existing MCR would require a level two underwrite – meaning two underwriters would have to underwrite the file as they have the authorization to override the MCR in the FHA Connection system.

Because the mortgage credit reject is going to be eliminated, we’re no longer going to have to deal with a second underwrite, Gastelum said.

“It’s not going to be more business. If anything it’s going to bring some of the borrowers that got declined at other companies back to the marketplace sooner,” Gastelum said.

FHA loan limits rose to a maximum of more than $1 million and mortgage insurance premiums for FHA loans were cut by 30 bps this year in line with home price inflation and to provide relief from the steep rise in mortgage rates.

Some loan officers noted that while the FHA’s decision to cut MIPs was a step in the right direction, the upfront mortgage premium (UFMIP), which amounts to 1.75% of the base loan amount, as well as a monthly premium for the life of the loan, could still be a burden for borrowers compared to those with a conventional loan.

However, affordability will still remain challenging for borrowers as wages would need to rise and home prices would need to fall to tackle that issue, Taylor noted.

“You’re not going to change affordability — which is the real reason people don’t have access to housing — by taking MCR off,” said Taylor.

But any little bit helps, Borodinsky said, citing a tough mortgage origination market that he’s never seen before.

“I welcome anything that moves the needle even fractionally. Because in this market, beggars can’t be choosers. This market is unlike any market we’ve seen in over 30 years in terms of there being no inventory, high interest rates and a real problem compounded with what’s called the lock-in effect,” Borodinsky said.

Source: housingwire.com

Apache is functioning normally

September 15, 2023 by Brett Tams

Settling credit card debt is a potential option when you have many missed payments over several months. If a credit card issuer or collection agency suspects they won’t get paid at all, they might be willing to accept less money than you owe. It’s typically a last resort to be explored after you’ve considered other debt-payoff options.

“Whether or not you can settle depends on each creditor; no two banks have the same collection process or settling parameters,” says Leslie Tayne, founder and managing director at Tayne Law Group. “The outcome can depend on many factors, including the creditor’s policies, the debt amount, the individual’s credit history, and the ability to negotiate effectively.”

Here’s what you need to know about how to settle credit card debt.

🤓Nerdy Tip

Note that settling credit card debt is different from — and riskier than — simply negotiating the cost of existing debt, such as attempting to get fees waived or APRs lowered.

Pathways for credit card debt settlement

There are different options for settling the debt on your credit cards. You can try the do-it-yourself method or have an attorney or company settle debt on your behalf. Regardless, there is no guarantee that the company that owns the debt will be willing to settle. Be wary of anyone offering debt settlement services who promises these results. Many people in their desperation to settle debt are left vulnerable to scams by debt relief companies or other sources. Before hiring anyone to settle debt on your behalf, research their background, history and track record.

Do it yourself

When deciding whether to settle debt on your own or hire someone to negotiate on your behalf, it’s worth considering the pros and cons for both. Hiring someone can cost more, but settling debt on your own can be a risk. The law can come into play, and if you don’t know what to look for, you could dig yourself deeper into debt and spend more money down the line to fix those mistakes. Consider your options and what is best for your situation.

Hire an attorney experienced with debt settlements

An attorney who specializes in debt settlement can help you consider factors like federal and state laws, statutes of limitations for debt, time-barred debts, whether you’re judgment-proof or have a lien due to other debts, credit reporting, and tax outcomes, among other things. They may also understand how certain creditors or collections agencies work and the kind of offers they are willing to accept.

It can be difficult to wrap your head around attorney costs when you’re already struggling to meet payments. It might be possible to find an attorney who offers reduced costs through a legal aid office, but they can be in high demand. Costs for a private attorney may vary based on the type of work involved. They may charge a flat fee per creditor, a percentage of the debt eliminated, or an hourly rate. Attorneys are in theory held to ethical standards, but some have been known to not charge fairly. When hiring an attorney, it’s in your best interest to do an online search for consumer reviews, consumer complaints, actions taken by the Consumer Financial Protection Bureau (CFPB), and the attorney’s standing with the state bar.

Hire a debt relief company

A debt settlement or relief company is an option, but it can come with risks and steep costs. These companies generally charge excessive fees and rarely deliver on the promised results, leaving you worse off financially, according to the CFPB’s website. You’re typically required to stop paying your balances and instead put that money into a savings account. As a result, you’ll incur late fees, penalty interest rates and potentially other charges. Pricey service fees may also apply for the debt and the savings account, which can be counterproductive if those costs cancel out the value of any balances settled. Some creditors may also refuse to work with certain debt relief companies.

🤓Nerdy Tip

If you choose to work with a debt settlement company, the CFPB’s website suggests contacting your state attorney general or a local consumer protection agency to see whether the company has any consumer complaints on file. Some states also require debt settlement companies to be licensed. You can verify if a company is licensed through your state’s regulator or attorney general.

How to determine if settlement is right for you

If your credit has already taken a hit because of missed payments for six months or longer, debt settlement is an option to consider, according to Tayne, but it’s not without drawbacks. Beyond the credit repercussions of missed payments, this option can leave a lasting mark.

“On a credit report, a settled account is identified as being ‘settled for less than the full balance,’” said Margaret Poe, head of consumer credit education at TransUnion credit bureau, in an email. “The settled account will remain on a credit report for seven years from the date of first delinquency, as with other derogatory remarks on a credit report.”

Even if you are able to settle debt, the journey toward that agreement may be packed with pitfalls. You should prepare to receive calls from your creditor or a debt collector as payments become past due. The costs will also keep spiraling as interest and fees continue to accrue. And, as you’re missing payments, it’s possible to get sued by the creditor or collection agency.

It’s a big risk to take when there’s no guarantee that you can settle debt.

How to negotiate a credit card debt settlement yourself

Negotiating a credit card debt settlement isn’t a one-size-fits-all approach, so the following steps may not work for everyone, and they don’t factor in other possible debts. You’ll need certain financial resources to settle debt. If you’re having trouble covering essentials like housing and food, consider bankruptcy as a potential option.

1. Consult an expert

Before trying to negotiate yourself, it may be in your best interest to consult an expert early in the process. An expert may alert you to blind spots. You don’t have to hire an expert or a company for the long term if the costs are overwhelming, but at the very least you can understand if you should go at it alone or consider other options like a debt management program.

You can get an initial consultation with an attorney or a certified credit counselor. The latter will be more affordable, but credit counselors aren’t very involved in the settlement process. What they can help with is exploring your options and helping you gain an understanding of whether a do-it-yourself approach is a good idea.

“We can obviously help with the budgeting process and thinking about, you know, other possible ramifications,” says Thomas Nitzsche, senior director of media and brand at Money Management International, a nonprofit credit counseling agency. “If a debt management program is not viable, the counselor is going to tell you that you really need to seek legal advice.”

An attorney will be more familiar with the settlement process. Unless you hire an attorney to represent you, though, that person can only offer general advice that may not be specific to your situation. Regardless, both experts are skilled at negotiating credit card debt, so it’s wise to at least consult one.

2. Figure out whom and how much you owe

Understanding who owns your debt is crucial. You can get some of that information in your free credit report from annualcreditreport.com, according to Tayne. But the report may not account for all of your debt in some cases. Judgments or liens don’t always show up on a credit report. You can go to your county recorder’s office to get information about potential judgments or liens and use online directories to find statutes of limitations by state, she says.

These are the kinds of steps an expert can potentially help you plan or consider before starting the settlement process on your own, hence why we recommend the consultation step above first.

3. Know your budget

By giving your finances an in-depth look, you can see how much money is truly available to negotiate a settlement. Review your budget and statements to explore the possibility of eliminating unnecessary purchases like lapsed free trials or others. Also look for opportunities to swap products or services for less costly alternatives.

In your review, you’ll also need to assess the highest and lowest amount you can afford to pay in a settlement. Consider whether it’s best to negotiate several payments or a lump sum.

The range should allow you to still prioritize essentials like rent, utilities, transportation, gas, food and anything else you may need. Ideally, you can negotiate for an amount that gives your budget room to breathe. Leave a buffer for potential emergencies and tax-related costs that may apply on debts forgiven over $600. Depending on your circumstances, it may be possible to get the tax costs waived, Tayne says.

4. Get organized

Once you know who owns your debt, look up contact numbers for those companies and write them down. You should also make a list of the debts, the amounts outstanding, and the range you can afford to pay back.

Here are some of the documents you may need:

Your budget and range for settlement.
Your credit report.
Documents concerning judgments or liens.
A script of what you’re planning to say.
A list of questions if a settlement agreement is proposed.

Practicing what you’re going to say will also help you be more confident in the actual negotiation process. Don’t step outside the parameters of what you can afford, and don’t negotiate out of fear — even if the person on the other end of the call seems intimidating.

In case you are able to get a settlement agreement, it helps to have a list of follow-up questions. For instance, you may want clarity on the following:

When, if at all, can you get the agreement in writing?
How will the settled debt appear on your credit report?
What happens if you don’t honor the terms of the agreement?
Will you be taxed on the amount settled?
Will you get a 1099-C for the settlement, and if so, when?

5. Make the call

Once you’ve done your prep work, you’re ready to make the call to the creditor or debt collection company. Before dialing, here are some best practices to consider:

To prevent unwanted surprises, don’t provide your bank account information upfront to the company that owns the debt. Wait until you have a signed agreement.
Write down the names of people you speak to and the time you spoke to them.
Write down the numbers of departments before accepting a transferred call.
Make as many calls as it takes to get through to the right person.
Start negotiations at the lowest offer possible (i.e., even if you can afford to pay 60%, start at 20%).

Once you’re ready to dial, ask to speak with an employee who can negotiate your debt. Start by asking, “I would like to settle my outstanding credit card debt. Can we discuss any options that you offer?” If you’re asked why you can’t pay it off, avoid revealing too much information, to prevent it from potentially being used against you in the settlement process.

“What consumers tend to do is just dump on the creditor tons of information that impacts and impedes the settlement process,” Tayne says. “Somebody who is an attorney understands how to filter certain information in order to appropriately negotiate in the client’s best interest.”

Once you share that you’re struggling to meet payments, the account may be closed if it’s still with the original creditor.

🤓Nerdy Tip

Don’t be afraid to ask for more time to think about a settlement offer. Ask for the direct number so that you can pick up where you left off. Don’t agree to any terms or offers that are unclear or out of budget. Ask for clarification or a breakdown of costs, if needed.

6. Get the agreement in writing

Request the agreement in writing and carefully review it before signing to ensure it includes the terms you agreed to. You might be under the impression that you’ve settled debt, but it may not be the case until you get all of the necessary details in writing.

The agreement should include the name and number of the account settled, the name of the creditor, the date, and the terms depending on whether you’ll have different payment deadlines or make a lump-sum payment, according to Tayne. You can also feel free to request that credit reporting details be included and anything else that might be relevant or useful to document.

Don’t make any payments or share any bank account details until the agreement is finalized.

7. Honor the settlement agreement

It’s important to meet the terms of the new agreement. Failure to do so can result in a lawsuit and fewer opportunities to negotiate in the future, Tayne says. To avoid further complications, be sure to pay off any tax-related costs that result from the debt settled.

Source: nerdwallet.com

Apache is functioning normally

September 15, 2023 by Brett Tams

MILWAUKEE, Sept. 14, 2023 /PRNewswire/ — Northwestern Mutual, a leading financial security company, announced today that Anne F. Ackerley and Andrew J. Harmening have been appointed to serve on its Board of Trustees. As a mutual company with a responsibility to policyowners, Northwestern Mutual has a Board of Trustees elected by its policyowners with responsibility … [Read more…]

Apache is functioning normally

September 15, 2023 by Brett Tams

Student loan debt nationwide currently totals $1.774 trillion (including federal and private student loans). The average federal student loan debt balance is $37,717 while the total average balance (including private student loans) is estimated to be $40,505, according to EducationData.org.

Student loan debt is now the second highest consumer debt category in the country behind only housing debt. Around 54% of bachelor’s degree recipients from public and private nonprofit four-year colleges and universities graduate with debt, according to the College Board.

A recent report from EducationData.org details the average student loan debt per borrower (based on federal student loan only) in each state. Overall, residents of Washington, D.C., are the most likely of all U.S. residents to have student debt, averaging $54,945 per borrower. Hawaiians, on the other hand, are the least likely to have student loans outstanding, with just 8.4% of residents in debt.

Student Loan Debt in Each State

Read on for an overview of what student loan debt looks like across the country according to EducationData.org . Note that this data refers to federal student loan debt only; private student loans, which represent 7.2% of all student debt, are not reflected.

Alabama

Average borrower debt: $37,137

Total student loan debt: $23.5 billion

Everything you need to know about student loans & scholarships in Alabama

Alaska

Average borrower debt: $37,137

Total student loan debt: $23.5 billion

Everything you need to know about student loans & scholarships in Alaska

Arizona

Average borrower debt: $35,396

Total student loan debt: $31.4 billion

Everything you need to know about student loans & scholarships in Arizona

Arkansas

Average borrower debt: $33,333

Total student loan debt: $13.0 billion

Everything you need to know about student loans & scholarships in Arkansas

California

Average borrower debt: $37,084

Total student loan debt: $141.8 billion

Everything you need to know about student loans & scholarships in California

Colorado

Average borrower debt: $36,822

Total student loan debt: $28.5 billion

Everything you need to know about student loans & scholarships in Colorado

Connecticut

Average borrower debt: $35,162

Total student loan debt: $17.5 billion

Everything you need to know about student loans & scholarships in Connecticut

Delaware

Average borrower debt: $37,559

Total student loan debt: $4.8 billion

Everything you need to know about student loans & scholarships in Delaware

District of Columbia

Average borrower debt: $54,945

Total student loan debt: $6.5 billion

Everything you need to know about student loans & scholarships in Washington D.C.

Florida

Average borrower debt: $38,459

Total student loan debt: $100.9 billion

Everything you need to know about student loans & scholarships in Florida

Georgia

Average borrower debt: $41,639

Total student loan debt: $68.6 billion

Everything you need to know about student loans & scholarships in Georgia

Hawaii

Average borrower debt: $36,765

Total student loan debt: $4.5 billion

Everything you need to know about student loans & scholarships in Hawaii

Idaho

Average borrower debt: $33,012

Total student loan debt: $7.2 billion

Everything you need to know about student loans & scholarships in Idaho

Illinois

Average borrower debt: $37,757

Total student loan debt: $61.6 billion

Everything you need to know about student loans & scholarships in Illinois

Indiana

Average borrower debt: $32,874

Total student loan debt: $29.8 billion

Everything you need to know about student loans & scholarships in Indiana

Iowa

Average borrower debt: $30,464

Total student loan debt: $13.2 billion

Everything you need to know about student loans & scholarships in Iowa

Kansas

Average borrower debt: $32,578

Total student loan debt: $12.5 billion

Everything you need to know about student loans & scholarships in Kansas

Kentucky

Average borrower debt: $32,779

Total student loan debt: $19.7 billion

Everything you need to know about student loans & scholarships in Kentucky

Louisiana

Average borrower debt: $34,525

Total student loan debt: $22.5 billion

Everything you need to know about student loans & scholarships in Louisiana

Maine

Average borrower debt: $33,137

Total student loan debt: $6.2 billion

Everything you need to know about student loans & scholarships in Maine

Maryland

Average borrower debt: $42,861

Total student loan debt: $35.9 billion

Everything you need to know about student loans & scholarships in Maryland

Massachusetts

Average borrower debt: $34,146

Total student loan debt: $30.8 billion

Everything you need to know about student loans & scholarships in Massachusetts

Michigan

Average borrower debt: $36,116

Total student loan debt: $51.0 billion

Everything you need to know about student loans & scholarships in Michigan

Minnesota

Average borrower debt: $33,604

Total student loan debt: $26.5 billion

Everything you need to know about student loans & scholarships in Minnesota

Mississippi

Average borrower debt: $36,902

Total student loan debt: $16.2 billion

Everything you need to know about student loans & scholarships in Mississippi

Missouri

Average borrower debt: $35,397

Total student loan debt: $29.3 billion

Everything you need to know about student loans & scholarships in Missouri

Montana

Average borrower debt: $33,149

Total student loan debt: $4.2 billion

Everything you need to know about student loans & scholarships in Montana

Nebraska

Average borrower debt: $31,919

Total student loan debt: $7.9 billion

Everything you need to know about student loans & scholarships in Nebraska

Nevada

Average borrower debt: $33,743

Total student loan debt: $11.8 billion

Everything you need to know about student loans & scholarships in Nevada

New Hampshire

Average borrower debt: $34,085

Total student loan debt: $6.5 billion

Everything you need to know about student loans & scholarships in New Hampshire

New Jersey

Average borrower debt: $35,434

Total student loan debt: $42.5 billion

Everything you need to know about student loans & scholarships in New Jersey

New Mexico

Average borrower debt: $34,211

Total student loan debt: $7.8 billion

Everything you need to know about student loans & scholarships in New Mexico

New York

Average borrower debt: $37,678

Total student loan debt: $92.7 billion

Everything you need to know about student loans & scholarships in New York

North Carolina

Average borrower debt: $37,721

Total student loan debt: $49.2 billion

Everything you need to know about student loans & scholarships in North Carolina

North Dakota

Average borrower debt: $28,604

Total student loan debt: $2.5 billion

Everything you need to know about student loans & scholarships in North Dakota

Ohio

Average borrower debt: $34,721

Total student loan debt: $62.3 billion

Everything you need to know about student loans & scholarships in Ohio

Oklahoma

Average borrower debt: $31,525

Total student loan debt: $15.4 billion

Everything you need to know about student loans & scholarships in Oklahoma

Oregon

Average borrower debt: $37,017

Total student loan debt: $20.1 billion

Everything you need to know about student loans & scholarships in Oregon

Pennsylvania

Average borrower debt: $35,385

Total student loan debt: $64.5 billion

Everything you need to know about student loans & scholarships in Pennsylvania

Rhode Island

Average borrower debt: $32,056

Total student loan debt: $4.6 billion

Everything you need to know about student loans & scholarships in Rhode Island

South Carolina

Average borrower debt: $38,414

Total student loan debt: $28.1 billion

Everything you need to know about student loans & scholarships in South Carolina

South Dakota

Average borrower debt: $30,954

Total student loan debt: $3.6 billion

Everything you need to know about student loans & scholarships in South Dakota

Tennessee

Average borrower debt: $36,418

Total student loan debt: $31.4 billion

Everything you need to know about student loans & scholarships in Tennessee

Texas

Average borrower debt: $32,920

Total student loan debt: $120.0 billion

Everything you need to know about student loans & scholarships in Texas

Utah

Average borrower debt: $32,835

Total student loan debt: $10.1 billion

Everything you need to know about student loans & scholarships in Utah

Vermont

Average borrower debt: $37,516

Total student loan debt: $2.9 billion

Everything you need to know about student loans & scholarships in Vermont

Virginia

Average borrower debt: $39,165

Total student loan debt: $42.4 billion

Everything you need to know about student loans & scholarships in Virginia

Washington

Average borrower debt: $35,510

Total student loan debt: $28.0 billion

Everything you need to know about student loans & scholarships in Washington

West Virginia

Average borrower debt: $31,690

Total student loan debt: $7.2 billion

Everything you need to know about student loans & scholarships in West Virginia

Wisconsin

Average borrower debt: $31,894

Total student loan debt: $23.2 billion

Everything you need to know about student loans & scholarships in Wisconsin

Wyoming

Average borrower debt: $31,250

Total student loan debt: $1.7 billion

Everything you need to know about student loans & scholarships in Wyoming

The Takeaway

The average amount of debt held by borrowers varies from state to state. The five states with the highest average amount of student loan debt per borrower are: Washington D.C., Maryland, Georgia, Virginia, and Florida. The five states with the lowest average of student loans per borrower are: Wyoming, South Dakota, Iowa, North Dakota, and Puerto Rico. North Dakota is the only state where the average borrower owes less than $30,000.

For millions, student loans and student loan refinances are a necessary part of paying for college. When federal aid and savings aren’t enough to pay for school, some borrowers turn to private student loans. These are available from banks, credit unions, and online lenders. While private lenders are not required to offer the same benefits or protections as federal student loans, they can be helpful for borrowers who have tapped other resources and are looking to fill in gaps in funding.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

Photo credit: iStock/FangXiaNuo

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SOIS0923017

Source: sofi.com

Apache is functioning normally

September 15, 2023 by Brett Tams

If you’ve been living in the U.S. these past few years, you know that rental rates have skyrocketed. Because of this, many renters cannot avoid spending more than the recommended 30% of their gross monthly income. This makes it all the more aggravating to find out your monthly rent has been raised by your landlord before your contract is up.

Raising rent can make sense in certain cases such as the market value going up. However, in other circumstances, a rent increase may be unnecessary or downright illegal.

It’s important to be educated on what can and can’t be done when it comes to your lease. Here is what you should know about your tenant rights and what you can do about it.

Can your landlord raise the rent?

The short answer to whether or not your landlord can raise your rent is yes and no. The city you live in, rent control laws and your lease will determine if it is legal or not. These are the circumstances when your landlord can and can not raise the rent.

Month-to-month leases

If you signed a month-to-month lease, landlords are within their rights to raise the rent at the end of each month. Similar to a 12-month lease, a monthly lease is still a binding contract. So your landlord would still be required to give you advance notice (generally about 30 days) and can only raise the rent at the end of the month.

Year-long leases

Typically, rent increases occur when your lease is up. So if you signed a year-long lease and your landlord tried to raise the rent six months in, that is not acceptable. Rent increases are only legal once the 12-month lease has finished.

The terms and conditions of your rent should all be laid out clearly in the rental agreement you sign at the beginning of your tenancy. Unless stated otherwise in the lease agreement, yearly and monthly rent increases are only allowed under the above conditions. That’s why it’s important to thoroughly read through and understand your rental agreement.

Keep in mind that a rent increase can also impact your security deposit. Since the rent is now higher, you may have to up the amount of the deposit as well.

Adequate notice

There are some circumstances under which your landlord legally cannot raise your rent. The first is without providing adequate notice. This is generally is about 30 days ahead of the proposed increase. It’s also illegal for a landlord to increase rent for discriminatory reasons or in retaliation for previous conflicts.

Discrimination

If you believe the rent increase is in response to a past conflict you had with the landlord or because they are discriminating against you based on your race, gender, sexual orientation or other reason, those are grounds to possibly have the increase overturned.

What to do if your landlord raises your rent

Receiving a rent increase is jarring and upsetting for anyone, especially since rent is already inflated. Finding out you may have to pay more or move is bound to trigger some strong emotions.

But you’re not without recourse and options for how to handle the situation. If you receive a rent increase notice and are unsure what to do, there are a few steps you can take.

1. Know your city’s laws

Renter’s rights can vary widely at both city and state levels. What’s legal in one city in your state isn’t always legal for other cities you may live in. This is why it’s crucial that, if you learn of a rent increase, you check your local laws.

This can pertain to whether the timing of the notice is legal, or if the increased amount is legal. Some states or cities don’t have set or maximum amounts for rent increases, leaving it up to the landlord’s discretion. So if there are no laws that set a cap or limit, your landlord can hike up the rent as much as they see fit.

2. Get it in writing

In most states, it’s required that any rent increase notice be served to the tenant in written form. This could be as a letter or email. If your landlord verbally told you they will raise the rent, that is not legal. If your landlord is trying to raise your rent and doesn’t provide written proof, that’s evidence you may use in case the situation goes to court.

3. Double-check your lease

Read through your lease to make sure that the rent increase notice is legal. This includes checking that the notice arrives in an appropriate time frame and adheres to any other relevant clauses.

4. Report any illegal actions to the proper authorities

If you determine that the rent increase is unlawful for whatever reason, you should report your landlord to the respective authorities in your area. This could be a local government agency or department related to housing or a housing and tenants’ rights advocacy group. They can point you in the right direction.

5. Speak with your landlord

Assuming the rent increase is legal, you still may not want to pay it. Maybe you are unable to afford the new proposed amount. Maybe you feel that based on your good rental history in that unit, it’s unnecessary or unjustified. Whatever the reason, you can try to negotiate with your landlord. You can do this in two ways.

The first would be to send them a rent negotiation letter. In the letter, you should describe in clear terms why you can’t or don’t think you should pay the increase.

You can detail your financial situation, or make reference to your rental history. Have you always paid the rent on time and in full? Are you a model tenant? Highlight those reasons the landlord will want to keep you on as a renter.

You can also arrange a meeting or call your landlord to negotiate the rent increase. When doing this, make the same points as you would in a negotiation letter but are able to have a straightforward conversation.

6. Organize with the other tenants

If all other attempts to negotiate with your landlord have failed, you may find strength in numbers. Check with the other tenants in your building to see if they are OK with the rent increase.

Collective action is a powerful tool. If the majority of the building opposes the rent increase and the landlord moves forward, they could be facing multiple people moving out at the same time. This gives them more work to suddenly try to fill the empty units. Having reliable, trustworthy tenants makes their job easier. This incentivizes them to work in good faith with the tenants they have.

7. Pay the increased amount

Unfortunately, if your landlord won’t budge and they are within their rights then you will have to pay the increased rent or find a new apartment to rent.

Getting a rent increase notice isn’t the be-all, end-all

Unless you live in a city with rent control, occasionally dealing with rent increases is, unfortunately, a necessary part of a renter’s life. Sometimes they can also feel very unfair. But by using the above resources, you can fight or even stop a rent increase.

The information contained in this article is for educational purposes only and does not, and is not intended to, constitute legal or financial advice. Readers are encouraged to seek professional legal or financial advice as they may deem it necessary.

Ashley Singleton is a writer who loves following and writing about current lifestyle, DIY and home improvement trends. You can read some of her other work on the Lady Spike Media website. In her spare time, she performs stand-up comedy in Los Angeles.

Source: rent.com

Apache is functioning normally

September 14, 2023 by Brett Tams

As an independent landlord, I’ve learned the ups and downs of landlording, and the tips and hacks I’ve discovered are musts for novice and seasoned landlords. The rental space is crowded, and it can be hard to compete with big corporate landlords. When I had my first rental at age 20, I was so excited to have my first tenant. However, first, to fill that vacancy, I needed to market my property and figure out the best channel for that marketing. That learning curve can be steep, and the ROI of your investment property depends on finding a great tenant as quickly as possible. I have some tried and true tips that will help you secure a great renter, and that starts with a solid online marketing strategy.

Syndicating Property Listing – Post Once

With the click of a button, your property listing can be posted on dozens of websites – this is marketing syndication. It saves a tremendous amount of time you would’ve spent individually making a listing on major sites. Save that time for flyers and yard signs, which are still viable and essential offline marketing tactics. We all know that time is of the essence as a landlord. Having your listing posted to Zillow, Rent.com, Apartments.com, and many more is truly the best way to acquire a higher number of leads, and having the ability for that to happen automatically is vital.

Furthermore, it’s essential to recognize the advertising doesn’t have to stop at just these sites. Social media is another excellent way to market your property online. Facebook and Craigslist are great options to increase your marketing reach. Younger generations love the option of social media as they can quickly scroll through the listings on their phones, find, and apply to properties to rent all on their device.

Stand Out From the Big Guys

Now you know where and how to post, that is the easy part, the hard part is knowing what to post. One common question we get from our landlords is, “How do I write a great property description?” Your goal is to differentiate yourself not only from the big guys but from any other rentals in your area as well. That means your photos, description, amenities, and policies need to stand out.

Photos

There is no doubt that your photos will be the first thing that your prospects check out. We live a superficial world, and this will be your properties first impression, so don’t ruin it with bad photos. There isn’t any excuse for bad photos. Smartphones take high-quality images, so often there isn’t a need for a professional photographer. Make sure you have good light, the rental is clean and mess-free. Aim to tell a visual story with your photos. If prospects like what they see, they will keep inquiring.

Amenities and Policies

It may seem hard to compete with large apartment complexes when it comes to amenities. The key is to identify your unique amenities as an independent landlord and speak to those. Renting has become more of a long-term housing option for many generations, that means their needs and wants for housing have changed as well. Many will want pets, as an independent landlord, you can be more flexible with your policies and may be able to charge a premium.

You may want to consider shorter or longer-term leases as well. Offering a month to month or short-term leases can be a great option to stand out, and again allow you to charge a premium. There is high demand for these types of rentals, and with a streamlined, online rental process, filing vacancies doesn’t have to be a time-consuming activity that cuts into your bottom line.

It’s All About the Leads

Now, you have great photos, have nailed the amenities, and syndicated your property and it is posted on all the listing sites. What’s next? The leads should start pouring in. Here at TurboTenant, we see an average of 22 leads per property. Getting a significant amount of leads will enable you to choose from a large pool of tenants. While this might seem overwhelming, it will help you fill your vacancy faster. You can quickly eliminate tenants who have red flags after you screen them with a background check, credit, and eviction report – after that, you can find the one you want to fill your property through more soft data. For example, you could meet with them in-person to see if they would be a good fit for your property, look at their social media, or meet with them to get coffee. The best method for choosing a tenant is always a combination of quantitative and qualitative data, as well as abiding by the Federal Fair Housing Act.

Becoming an independent landlord is a great investment strategy, and now is an incredibly opportune time to invest. With the right strategy and software, the path to a successful landlord can be smooth, seamless, and streamlined.

Source: geekestateblog.com

Apache is functioning normally

September 14, 2023 by Brett Tams

Even with the uptick in inflation, most observers are expecting the Federal Open Market Committee not to raise short-term rates at its next meeting. But that doesn’t mean mortgage rates this week were immune to the report.

The Consumer Price Index rose 0.6% on a seasonally adjusted basis in August, compared with a 0.2% increase in July. Unadjusted, the index was up 3.7% on an annual basis, the Bureau of Labor Statistics said.

If this report was a weather forecast, the outlook for the home lending business would be partly cloudy, said Marty Green, principal at mortgage law firm Polunsky Beitel Green, in a statement.

“I don’t think it alters the Fed’s path at its next meeting, where they will talk tough but leave rates unchanged,” Green said. “However, their path at the November and December meetings is still unclear, as they telegraphed the possibility of another rate increase in 2023.”

This report will not change investors’ minds about the mortgage rate environment, he said.

They are elevated based on expectations that rates will be falling next year. “So there is an increased likelihood that mortgages originated today will not stay on the books for very long,” Green said. “Accordingly, investors require a premium to make the investment.”

The Freddie Mac Primary Mortgage Market Survey noted the average for the 30-year fixed rate loan increased for the first time in three weeks to 7.18%, from 7.12% one week ago. A year ago, it was at 6.02%.

But the average for the 15-year FRM was down 1 basis point to 6.51%. It was at 5.21% for the same week last year.

Rates “remain anchored” above 7%, said Sam Khater, Freddie Mac chief economist, in a press release.

“The reacceleration of inflation and strength in the economy is keeping mortgage rates elevated,” he continued.

However, Zillow, which tracks rates based on offers made through its website, reported the 30-year FRM at 6.94% on Thursday morning, down three basis points from Wednesday and 7 basis points from last week’s average of 7.01%.

Orphe Divounguy, senior macroeconomist at Zillow Home Loans, said the decline reflects investor expectations of slower consumer activity and weaker economic growth in the future.

“The August uptick in inflation — a key driver of Treasury yields and the mortgage rates they influence — was mostly due to supply factors that pushed energy prices higher,” Divounguy said in a Wednesday night statement. “However, declining wage inflation coupled with continued strength in employment growth are bringing demand and supply into better balance, putting the U.S. economy on a more sustainable growth path.”

Most investors are still expecting the U.S. economy to enter into a recession. In that case, mortgage rates should go down. However, consumer spending is moderating, not crashing, and productivity is on the rise.

“This will likely push longer term Treasury yields higher, preventing any further declines in mortgage rates,” Divounguy said.

Right now things are moving sideways, as at noon on Thursday, the 10-year Treasury yield was at 4.28%, up just 3 basis points from Wednesday’s close, 2 basis points higher than at the end of the day on Sept. 7 and down 1 basis point from Sept. 6 close.

Source: nationalmortgagenews.com

Apache is functioning normally

September 14, 2023 by Brett Tams

The Realtor survey was sent out in late July to 55,751 randomly-selected residential Realtors. NAR received 1,919 responses by the mid-August close date of the survey. The homebuyer survey was conducted by Morning Consult in June 2023. Of the 2,201 respondents, 587 were white, 560 were Hispanic/Latino(a), 533 identified as African-American/Black and 521 identified at Asian American or Pacific Islander (AAPI).

In the realtor survey, Millennials were the largest home buyer generation represented. Forty-two percent of agents reported that they were working with Millennials, followed by Gen X at 22%, Baby Boomers at 12%, Gen Z at 8% and Civics (those aged 78 and older) at 1%.

White homebuyers were the largest racial group represented at 58%, followed by Hispanic/Latino(a) at 11%, African-American/Black at 10% and Asian-American at 3%.

Over half of the Realtors (51%) reported they their buyers were first-time buyers. In the buyer survey, 71% of white respondents reported they currently own a home, while 67% of African-American/Black responses said they do not currently own a home. In addition, 89% of Hispanic/Latino(a) buyers, as well as African-American/Black buyers said they will be first-time buyers, compared to just 65% of white respondents.

When broken up by race or ethnicity, white buyers are more likely than other races to report not yet having a purchased a home mainly due to lack of availability in their budget, while Hispanic/Latino(a) buyers are more likely to be hampered mainly by the inability to save a sufficient down payment. AAPI buyers are most likely to be waiting for prices to drop and African-American/Black buyers are most likely to report trouble getting approved for a loan due to credit issues as the main reason they have not bought yet.

Generationally, Gen X (12%) and Baby Boomer (11%) buyers are more likely than other generations to be waiting for prices to drop (only 9% of Gen Z buyers and 6% of Millennial buyers are waiting for prices to drop). However, Baby Boomers are the least likely to be concerned about competing with all-cash buyers, with just 24% listing this as a concern compared to 34%-42% for the other generations.

Exploring finance options

According to the Realtor survey, 77% of their prospective buyers who have applied for a loan, have been approved, while 6% have applied but been denied. Of those who have been denied, 12% report it is due to low credit score and 9% report it was due to insufficient down payments.

Black/African-American buyers who have not been approved for a loan are more likely than other racial or ethnic groups to have been denied due to low credit scores, at 32% versus 17% or less for the other racial and ethnic groups.

Realtors reported that 68% of their buyers were considering a conventional loan, 38% were considering an FHA loan, 8% were considering a VA loan and 7% said their buyers did not need home loan financing. FHA loans more likely to be considered by African-American/Black and Hispanic/Latino(a) buyers than white and AAPI buyers, and white and AAPI buyers were most likely to not need financing, at 8% and 9% respectively, compared to 4% or less for other racial and ethnic groups. Broken down on generational lines, 25% of Baby Boomers report not needing financing, compared with just 8% or less for younger generations.

First time buyers (54%) are more than twice as likely as repeat buyers (22%) to consider an FHA loan. Divided among racial and ethnic groups, African-American/Black buyers (62%) and Hispanic/Latino(a) buyers (57%) are more likely to consider FHA loans than other groups (34% or less). Generationally, younger buyers are more likely to consider FHA loans with 57% of Gen Z buyers reporting they have considered an FHA loan, compared to 11% of Baby Boomers.

Among buyers who were eligible for FHA or VA loans, 20% of realtors said their buyer clients have not considered VA or FHA because they do not want to pay private mortgage insurance (PMI) (21%) or they are worried their offers will be less competitive with these options (19%).

According to the survey, 53% of realtors say that at least one issues is holding their latest buyer back from saving a competitive down payment, with 23% reporting current rent or mortgage payments holding buyers back, 17% reporting credit card balances or payments, 12% reporting student loan debt and 11% citing car loans.

First-time buyers are significantly more likely to struggle with these challenges than repeat buyers, with twice as many first-time buyers reporting that they are struggling with credit card payments (22% vs. 11%), and student loan debt (17% vs 7%). When broken down via race and ethnicity, AAPI (52%) and white buyers (52%) were more likely than African-American/Black buyers (31%) and Hispanic/Latino(a) buyers (36%) to report that nothing was holding them back from saving for a down payment. Along generational lines, younger buyers are more likely to be held back by student loan debt (20% of Gen Z, 15% of Millennials, and 8% or less for older generations), car loans (16% of Gen Z vs. 3% of Baby Boomers) and childcare expenses (12% of Gen Z, compared to 2% of Baby Boomers). Overall, the older the buyer the more likely that none of the above issues are holding them back from saving for a down payment, with 70% of Baby Boomers reporting that none of these issues are holding them back compared to 40% of Gen Z buyers.

Despite their challenges, only 23% of Realtors reported that their buyers dealing with these challenges have applied for down payment assistance programs, while 12% of consumers reported that they were unaware of these programs.

The number one reason, at 30%, Realtors cited as to why their buyers who were aware of down payment assistance programs did not apply was that their income was too high. This was followed by 19% who said their buyers didn’t know enough about the programs and 17% who were worried about the competitiveness of their offers in a multiple bid situation.

First time buyers were three times more likely to have applied for down payment assistance programs than repeat buyers at 30% compared to 10%. Similarly, the younger the buyer, the more likely they are to have applied for a program, with 36% of Gen Z buyers reporting they had applied versus 11% of Baby Boomers.

Among racial groups, AAPI buyers were the least likely to have applied to a down payment assistance program at 13% versus 22%-31% for other groups. In addition, they were the most likely to say they were unaware of the programs at 26% compared to 8%-13% for other racial groups.

Location, Location, Location

When determining the location of their future home, 71% of realtors reported that their buyers were determining the location of their next home base on the location of their job or the job of someone in their household. Of the remaining roughly 30%, 16% said their buyer work fully remote and 14% reported that they buyers are retired. They are typically looking for 30 minutes or less of driving time (consumers reported 25 minutes or less).

Baby Boomer were the most likely to be retired at 61% compared to 2%-9% of other generations, while Gen X buyers were the most likely to work fully remotely at 24% versus 9% to 14% for other generations. Millennials (84%) and Gen Z buyers (86%) are the most likely to determine the future location of their home based on the location of their job (28% to 67% for older generations), and similarly, first-time buyers (83%) are more likely than repeat buyers (57%) to determine location based on the location of their job.

Compared to other racial or ethnic group, Hispanic/Latino(a) buyers were most likely to determine the location of their future home based on the location of their jobs, at 82%, compared to 69% to 74% for other groups. White (16%) and African-American/Black buyers (12%) were the most likely to be retired or not workings (other groups ranged from 7% to 8%).

Nearly half (49%) of Realtors said their buyers have no preference between existing and new construction, however white buyers were significantly more likely than other racial groups to prefer existing homes at 46% compared to 27% to 35% for other groups.

The vast majority of Realtors (89%) said their buyer clients were buying a primary residence, while 6% reported they were buying an investment property and 5% said they were buying a vacation or rental home.

Discrimination remains under reported

Of the Realtors surveyed, 1% of Realtors reported that their buyer experienced discrimination during buying process, while 13% were unsure. Among the 14 Realtors who reported that their buyer experienced discrimination, the most common form of discrimination came in the form of loan products offered by the lender (43%) or that the buyer did not receive a call back from the lender (29%). Realtors who reported that their clients experience discrimination, said the most common reason was race (57%), followed by age (29%), and familial status (21%).

Other common sources of discrimination reported were color, religion and national origin (all at 14% each), as well as sex, disability and sexual orientation (all at 7% each).

Despite experiencing discrimination only 7% of the agents said their clients reported the discrimination to a government agency or legal aid organization.

In the consumer study, roughly one in six prospective buyers reported experiencing discrimination during their home buying process, with more than half of Black, Asian, and Hispanic buyers reporting that this was due to their race or ethnicity. White buyers are equally likely to report discrimination but are more likely than others to say this was based on factors other than race or ethnicity. NAR reported that based on both studies is believes that most of this discrimination goes unreported.

Consumers who experience discrimination reported that this most often manifested in their being steered towards or away from specific neighborhoods and in stricter requirements. Among successful buyers 50% of Hispanic/Latino(a) buyers experienced steering, compared to 29% of white buyers and 12% of African American/Black buyers, while 17% of AAPI buyers, 24% of White buyers and 12% of African American/Black buyers reported stricter requirements.

Source: housingwire.com