Written by Carese Busby, Loan Consultant with Caliber Home Loans

Millennials are among the most educated and financially conservative group of consumers we have seen in generations and that doesn't come as a huge surprise. They've been presented with a perfect storm of factors that present a challenge to achieving their dreams of home ownership, from student loan debt to lack of job opportunity and stability.

More than any of the previous generations, parental involvement is paramount to this generation's home ownership aspirations. Most parents don't dream of having their children take up real estate on their couch when they are trying to enjoy the next chapter of their lives. Economic and social conditions have put millennials in a position to seek assistance from their parents in a variety of ways to help them save and prepare for their own housing expenses. The good news is that there are some great options for millennials that can help parents liberate them from the couch and realize their own dream of independence through home ownership.

  • Down payment assistance programs - There are some great down payment assistance loan programs available in the market that allow a home buyer to purchase a home or condo potentially with little to no down payment. These programs are also not limited to first time home buyers. Borrowers need to get pre-approved to ensure they meet the guidelines for the program as it relates to median county income limits as well as other guidelines. Besides achieving home ownership independence, there are also tax benefits to owning versus renting. Consult a tax professional for specific details.
  • Bank of Mom & Dad - Borrowers can receive a monetary gift from family members toward a home purchase. Parents can choose to pass along some of their wealth to their children through a gift to help them buy a home. There are some programs that allow for all of the down payment and closing costs to be from gift funds. The source of these gifts from the parents are overwhelmingly coming from their savings accounts as well as tapping into equity in their own home through refinancing to help their children with down payment and closing costs on their home purchase. View more information from the source here >>>.
  • Partnership - Parents can choose to help their children qualify for certain loans through being a non-occupant co-borrower (aka co-signer) on the loan. This allows for the millennial to get into their first home while utilizing their parents financial status to help them qualify.
  • Equity Gifting - Some borrowers wish to purchase the home they grew up in and parents are agreeable to selling the family home to their kids. Parents have the option of gifting the equity in the home toward the required down payment for the kids and this can provide a win-win situation. The kids are liberated from the couch and now keep their childhood memories, while the parents can move on to their next home.
  • Giving Back - There are some properties that have mother-in-law units that can provide a rental income stream to help with the monthly mortgage payment or provide a great apartment for Mom and Dad to stay in their twilight years. You can get creative and combine one or more of the above gifting and/or partnering concepts for this property purchase.

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