According to a recent survey of non-homeowning consumers, commissioned by Bankrate.com, nearly half of the respondents said they would like to buy a home now – but can’t afford a down payment or think that their credit isn’t good enough to qualify. Here’s the story from Bankrate’s Crissinda Ponder.
According to the recent Bankrate Money Pulse Survey, nearly half of respondents say they’re not homeowners right now because they either can’t afford a down payment (29%) or they believe their credit isn’t good enough to qualify for a mortgage (16%).
“A lot of people make assumptions that they can’t afford to buy based on just some perceptions, and many have not taken the step to figure out how mortgage-ready they are,” says Marietta Rodriguez, vice president of national homeownership programs at NeighborWorks America in Washington, D.C.
The share of non-homeowners who have counted themselves out of homeownership for the time being is somewhat expected, considering the lasting effects of the housing meltdown, says Pava Leyrer, chief operating officer for Northern Mortgage Services in Grandville, Michigan.
“A lot of people went through some deep pains in the past 10 years or less,” she says, citing foreclosures, job losses and bankruptcy filings. “All of those things are traumatic in your life.”
The survey also asked non-homeowners what percentage of the total cost they would contribute as a down payment on a hypothetical home purchase. Nearly 2 in 10 said somewhere between 11% and 20% down, and another 17% of respondents would put down 6%-10%.
The most popular response, however, was “don’t know” – almost a quarter of non-owners report they don’t have a clue how much they would put down to buy a home.
Although it appears to be a substantial percentage of people, Rob Chrane, president and CEO at Atlanta-based Down Payment Resource, says it’s consistent with what his company has encountered.
The survey underscores the fact that many aren’t aware that down payment assistance is available, which could be keeping them on the sidelines.
“The biggest single issue is that consumers just don’t know these programs even exist,” Chrane says. “If you don’t know of the possibility then you don’t know to ask people for help with it.”
