Student loan payments are set to begin in September, in this edition of Motto Moment with John Kunkle of Motto Mortgage, you will learn about how this impacts your ability to purchase a home.
John: Finding the perfect home is a challenge in today’s market. Often, a cash offer has been made before one’s real estate agent can submit their offer. Today we discuss navigating the challenging real estate market, student loans, and the upcoming homebuyers meet and greet.
As the real estate market continues to heat up with low inventory levels, it becomes even more important for buyers and sellers to work with experienced professionals who can guide them through this competitive landscape. Individuals can successfully navigate this hot real estate market by staying informed, being prepared, and making well-informed decisions. The key is to meet with me, and let’s review your financial status and determine what you can afford and how we can get the absolute best interest rate and type of loan. This will make one’s meeting with a real agent most productive and ensure one is looking for homes within their budget. This also gives the buyer a competitive advantage by allowing them the ability to make an immediate offer.
The buzz phrase in lending is, “date the rate, marry the house.” This means if you find the house you love, don’t let the rate prevent you from buying it. Rates will go up, and rates will go down. The most important decision is whether this rate allows one to make their house a home. Will one have enough money to pay bills and enjoy life? The last thing one wants is to buy a house and get behind on payments. When it comes time to refinance, that will make it difficult. If you do buy, start putting money back each month and saving for when it is time to refinance.
Student loan debts are weighing heavily on potential homebuyers. On August 31, the suspension of payments and interest on the $1.6 trillion in federal student loans that 44 million Americans owe will come to an end. Since the beginning of the moratorium, up to 30 million borrowers have gotten a new loan servicer. Borrowers should sign-on to studentaid.gov, verify their servicer, and contact them to discuss repayment options. Everyone with a student loan must ensure their payment plan meets their financial budget.
A: How does student loans affect one when buying a home?
John: The borrower’s monthly student loan payment will be calculated into the monthly debt-to-income. If a borrower has an amount greater than a zero payment, most loan programs will go with the actual payment amount reported on the credit report or letter from the loan servicer. However, for FHA, if the payment is zero, we calculate a payment of one-half percent of your student loan balance as a monthly payment.
Q: Do you have another opportunity to meet in person coming up?
John: Yes, I am excited to be hosting the second homebuyers meet and greet. Being educated in the homebuying process is critical and I want those who are actively looking, and those who may be looking in the near future to have a solid understanding of the complete homebuying process. On Tuesday, September 12, from 5:30 – 7:30, I will host a homebuyer meet and greet at the HUB, located just a couple doors down from City Hall in Cherokee Village. There will be realtors, appraisers, title companies, insurance brokers, home inspectors, and myself on hand to answer all real estate-related questions. Again, that is Tuesday, September 12 from 5:30 to 7:30 p.m. at the HUB in Cherokee Village. For any questions, please reach out to me.
This has been your weekly Motto Moment with John. If you have questions or if I can help unlock the home of your dreams, give me a call at 479-621-3500. Let me preapprove you for your first home, dream home, investment property, or farm. A pre-approval letter makes one much more likely to accept your offer in this hot real estate market. I’m John Kunkel, your Motto Mortgage Loan Officer. Unlocking homeownership dreams one key at a time.
Motto Mortgage offices are independently owned, operated, and licensed. An equal housing opportunity. John Kunkel NMLS 1-4-1-6-0-7-8, Motto Mortgage United Group 2-0-7-8-9-1-5, Motto Mortgage Velocity 2-2-8-8-2-5-6, and Motto Mortgage Heritage 1-7-2-0-4-3-8.
