Debt has seemingly become a part of the average American’s life. According to the Federal Reserve Bank of New York, 44.7 million people have outstanding student debt. The number of people who have credit card debt has ballooned to 120 million this year. As a result, homeownership is down while landlord-tenant disputes are up. But you don’t have to wait years until you’ve paid off all your loans to get a mortgage. Here are 5 reasons you should buy a house even while you’re still in debt:

Homeownership Programs and Affordable Loans

An FHA loan is ideal for people with existing debt. First, the required down payment is lower than other loans or mortgages. The conventional down payment is at least 20% of the property value. Meanwhile, you can put a down payment as low as 3.5% for FHA loans.

Perhaps the biggest reason for these types of loans is the qualification. Whether you have student loans or credit card bills, you probably don’t have the best credit score. The minimum required score is 580 unlike other mortgages which is at least 620.

The offer works because the Federal Housing Administration insures the lender. In turn, the lender is much more lenient with the approval and the conditions than other programs.

There are also programs made for particular professionals. One example is the physician mortgage loan. To qualify, you need to have a dentistry or medical degree and a contract of employment. The best benefit to these types of loans is that they make allowances for student loans. Depending on the lender, your medical school debt may even be excluded from your debt-to-income ratio.

These types of benefits aren’t just reserved for doctors. There are government programs that help teachers, police officers, and firefighters become homeowners. One of them is the Good Neighbor Next Door Sales Program. It gives qualifying applicants a 50% discount on houses. You must also commit to live in the property for 3 years to avail the discount.

Return on Investment

For both rents and mortgage payments, you pay a significant amount of money every month. The big difference comes down to ownership. For mortgages, you’ll own the house after a few years of payment. For rental properties, you don’t get anything. This is especially important if you consider how much people spend on rent. According to a report by Harvard University, around 10.9 million people use more than half of their salary to pay for their rent. This means that the biggest expense for 25% of all renters across the country is their rent. Combined with loans and credit card debt, it translates to a very bad financial situation.

Meanwhile, if you own a property, it can pay itself back in several ways. One is the stability. Even if you’ve lost your job, you don’t have to worry about paying for rent on top of other expenses. You’ll always have a place to live in free of charge. Another benefit is the resale value. If you’re willing to do a few home projects and touch up the place, you can earn money by selling the property at a price that’s higher than its original value. If you’re not willing to part ways with the house, there’s still a way to earn money. You can put the property for rent or lease. The good part about this is the regular earnings. You’ll have a regular income besides your salary that can help pay off your debt.

Tax Breaks

person computing taxes

While the average American only has one source of income, the expenses are endless. Besides your credit card bill and school loans, you also have to pay for groceries, electricity and water bills. If you have a car, you’re also spending money on insurance, gas, and maintenance. The expenses don’t end there. You also have to pay your taxes. While the amount depends on the state you live in, taxes can cost you thousands and thousands of dollars per year. Combined, everything can be overwhelming.

On the bright side, owning a home can help your problem. You can take advantage of government incentives and lower your taxes by buying a house. The federal government has spent almost $200 billion in one year to help Americans become homeowners. The great part about it is that it has a broad definition of homes. It means that buying an RV or a houseboat may help lower your taxes.

You don’t have to wait for years to get a house all to yourself. There are plenty of programs that can help you afford a nice home now, even if you’re still in debt.

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