For the last few years, millennials have been criticized for their lack of urgency to get their hands on a set of house keys. Not being able to afford a downpayment, thinking you can't qualify for a loan, finding renting more convenient and cheaper, and not wanting to be tied down to one property, are all common reasons why the largest generation in U.S. history may have previously steered away from homeownership.

However, as of 2021, owning a home might be a better financial and lifestyle decision compared to renting. Benefits include being in control of your living space, having flexibility in future decisions, taking advantage of privacy and security, and harnessing the potential to build wealth. Most millennials want all of this, but some simply don't know where to start. So what you truly need is some education and guidance on the home buying process, if you’re thinking of your home as a wealth vehicle, the sky’s the limit.

Today I'm sharing 10 golden tips to help millennials get a head start on the loan purchase process to buy their first home!

1. Save up for the down payment. The more money you have saved up, the better. A strong downpayment can help lower your interest rate and help you pay off your mortgage faster, which can result in you saving thousands of dollars. Be patient and strategic with your saving strategy and keep saving! Set a goal and be realistic, you need to have an accurate idea of how much house you can afford. Once you set a goal for yourself with accompanying action steps, it will take less time and effort than you think. After saving up for a solid down payment, you can play around with your budget to know how much of a monthly mortgage you can handle.
2. Delayed gratification is king. Delayed gratification is the path to wealth. Live within your means now and look at the big picture. The ability to hold out now, for a better reward later, is essential for long term wealth. Instead of buying a flashy new car with your new promotion, put more money towards your savings so you can purchase a home sooner. Again, the more you have saved up the better.
   
3. Finding a broker you trust and can build a relationship with is important. Your mortgage broker is a key player in identifying the best home loan for you. This is a very personalized process and requires trust and transparency. Finding a broker your trust is one of the most important parts of the home buying process. The broker you choose will guide you through one of the most emotionally and financially taxing transactions of your life. When choosing a mortgage broker it is important to build a relationship with your advisor, feel comfortable, and have a plan that not only suits you now but for the next 10 years down the road. At Wilkes Mortgage Group, building relationships with clients is our priority, with an emphasis on family, trust, and treating each client as an individual. Communication, authenticity, resourcefulness, and loyalty should be some of the most important qualities in the broker you choose.
4. Do your research. It's important to find a broker you trust, but how do you find them? You do your research. Be an informed consumer, just like you would check reviews for restaurants and bars, check your broker's background. The internet will show you the facts and as a tech-savvy millennial, you should prioritize researching potential brokers.
5. Be a conservative credit card user. Credit card debt among millennials continues increasing and surpassing past generations' averages. It can be easy to let your credit spending get out of control and monthly payments and accumulated interest can quickly become a problem. This can cost you hundreds of dollars that could have been put towards saving for a home down payment. Think about what you're financing and what you're putting on your credit. When used responsibly, a credit card can be a very helpful financial tool. Make consistent, on-time payments to help boost your credit score and take advantage of cashback rewards.
   
6. Reap the tax benefits! Once you enter a mortgage contract, whether it is for your home, a rental property, or a condominium, you are eligible for several tax breaks. You can benefit from multiple tax reductions through mortgage interest, real estate taxes, points paid to your mortgage lender as part of a new loan, private mortgage insurance payments, and more! Essentially, the benefits of having a home are huge with the tax write off. You could end up saving so much money with the tax write off available to you as a homeowner, that your mortgage could come out cheaper than your original rental payment. Tax season will just require a bit more effort and paperwork than usual, but it is so worth it in the long run.
7. Remember that homes appreciate! You will gain wealth through equity. Your home is an asset, an asset that is certain to gain value over time. Unlike cars, boats, computers, and furniture, properties appreciate, this means that year after year the value of the property increases. How much your home appreciates each year will depend on the local real estate market and any improvements that were made to the property. Los Angeles is in the top 10% nationally for real estate appreciation with an annualized rate of nearly 7%. To put this in perspective, the national average for regular appreciation rates is from 3-5%.
8. Stop waiting until home prices lower, chances are, they won't. If you keep waiting for home prices to lower, you'll never make the jump to purchase your first home. In Los Angeles, prices have been on the rise over the past decade with an increase of around 10% per year. If you had purchased a home in the LA area three years ago, you would have gained 30% equity already. This doesn't apply exclusively to Los Angeles, markets are on the rise all over the country especially as more and more small cities are growing each year. It is never going to be the right time to buy, it's always going to be based on a bunch of variables and unknowns. So the sooner you do it, the more time you have to get well-adjusted, easier to make the next step.
9. You are probably more ready to purchase a home than you think you are. If millennials make small tweaks to their spending habits and act like smart investors, they can take over the home market in no time. With interest rates being at record lows and down payments being accepted as low as 5%, there is much wider affordability and greater buying power available than ever before. Millennials also have the advantage of having more assistance available to them than generations in the past.
10. Your first home doesn't have to be your forever home. A common misconception is that when you buy a home it should be your forever home. That could not be further from the truth. The sooner you get into a house, the closer you are to getting your dream home. Eventually, you can use that first house as a rental property. Buying a home is an investment. You also don't have to get attached to your first home, you may outgrow it. It is important to continue saving even after you purchase your first home for when you find your dream home.
    

The truth is that millennials want to buy homes, but you face several obstacles on a greater scale than previous generations. Student debt, credit card debt, and lack of financial literacy are among common factors. The world of real estate has also greatly changed. It is no longer a game of saving everything towards a down payment and finding a real estate agent on the yellow pages.

In a more technologically advanced world, millennials want to find an agent that understands their needs and wants. The millennial home buyer wants a true connection with their agent and mortgage broker, so you don't feel like you have to give up everything to buy a home. At Wilkes Mortgage this is our goal. Each client is an individual and a strong foundation of trust and education is the key to any transaction.

After closing thousands of loans throughout my 16-year career as a licensed realtor and mortgage broker, my objective is straightforward and clear. Close on time and have unparalleled communication with my clients and realtors. I have helped Americans find a home that works for them and made sure to remain in contact with every client to assist them with any further home needs they may have.

Think you're ready to become a homeowner? At Wilkes Mortgage Group, we offer personalized mortgage solutions and fast customized quotes so you can find a broker you trust and a home you can afford.

Take the first step today at https://wilkesmortgagegroup.com/buy/ or contact me to weigh out your options at henryw@scottcapitalgroup.com