Welcome to the BeSmartee blog. Enjoy a wide selection of articles related to mortgages, the industry, and real estate.

How These 3 Millennials Bought Their Homes

By Laura Agadoni · Aug 30, 2016 · Mortgage

How These 3 Millennials Bought Their Homes

Image courtesy of Kelby Green, Kelby Green

Here are three stories from millennials on how they went about buying their first home.

The percentage of homes sold to first-time homebuyers is lower than it's been in 30 years, according to the National Association of Realtors

There are a number of factors why millennials find it difficult to buy a home:

  • High rent in some areas makes it difficult to save.
  • Low inventory in certain markets drives prices up.
  • Many millennials have too much debt, much of it student loan debt.

But despite the hurdles, many millennials are buying homes. Here are three stories from millennials on how they went about buying their first home. Maybe their stories can serve as inspiration for you.

Kelby Green, Common Cents Content & Marketing

Kelby Green

Kelby Green bought a home six years ago, taking what he calls the ''normal path.'' He graduated high school, went to college, got married, had kids, and bought a house.

Buying a home made sense for Green and his family. His rent was rivaling what his probable mortgage payment would be. And Green figured the area he wanted to buy in would appreciate, and soon. How did he know? Green noticed that urban sprawl made his target neighborhood, which was once the suburbs, part of the city. Yet there was still a sense of community. An exciting in-town neighborhood with a low crime rate always makes a good choice.

Although the housing market was down at the time, Green wasn't quite ready to buy. He had thousands of dollars in student loan and consumer debt to pay. ''We weren't the best with our finances early in the relationship,'' he says. ''So we started making changes, putting things in place to make sure we could make the purchase.''

Green discovered that his debt-to-income (DTI) ratio was higher than it needed to be to qualify for a mortgage, which is no more than 43%. So Green set out to fix this. ''We used to eat out 95% of the time. So we really buckled down and started eating at home,'' he says. Another way Green and his family saved money was to spend leisure time at the park instead of the mall, where making impulse purchases often happened. ''And the park was still entertaining,'' he says.

Green ended up getting an FHA mortgage loan with a 5.25% interest rate. Rates have dropped since then, and Green plans to refinance as soon as he qualifies. Because Green recently started working for himself, he figures he'll need to wait at least two years before he can refinance.

Green's advice to anyone looking for a home is to make your lifestyle changes a year or even two years before you're ready to buy. ''Do research to see what you need to qualify for a mortgage,'' says Green. ''What does your credit score look like, and what is your DTI ratio? How much should you have saved? Don't go into this backwards by first finding a home and then later figuring out what you need to do.''

Brian Davis, SparkRental

Brian Davis

Brian Davis, a ''W2 employee with a decent income,'' had no trouble finding financing for a home. However, since his goal was to find a bargain property that needed some TLC, finding a house proved challenging. ''In order to obtain a conventional mortgage, which was important to me, the home had to be declared livable by the appraiser,'' he says. After 15 months of house hunting, Davis found the perfect house. ''It needed quite a few upgrades, but it managed to pass as livable.''

If you want to buy a bargain home that you don't mind fixing up, Davis has some advice. ''Be patient, but act quickly. Bargains go quickly, so you'll need to be one of the first in the door when a promising home comes on the market.'' And just what does Davis mean by acting quickly? ''That means seeing properties on the same day they're listed and making an offer that night.''

You'll need to have all your ducks in a row before you go house hunting to be able to move that quickly. Make sure you have enough saved for a down payment, closing costs, and cash reserves to pay the mortgage for a few months if something were to happen, such as a job loss. It's also a good idea to be prequalified for a mortgage. That way, you'll be able to show sellers that you are a serious candidate.

Be prepared to wait for weeks or even months for the right deal to come along. ''Bargain hunting for a home is a bit like war,'' says Davis. ''Long stretches of boredom interspersed with brief, intense bursts of action.''

Niki Monty, Niki Monty Brand Development and Professional Writing

Niki Monty

Although Niki Monty and her husband had about $40,000 worth of debt, they had a good income. And Monty's husband had excellent credit, which allowed this millennial couple to buy a single-family home in a family-friendly neighborhood.

''My husband's credit score allowed us to get a low rate with no private mortgage insurance (PMI) and no money down,'' says Monty. How did this couple wind up with that sort of deal, you may wonder. ''Our credit union, Navy Federal, offered a rare program with no PMI for those with qualifying credit scores,'' says Monty. The couple paid an interest rate between 1% and 2% higher than if they paid PMI, but Monty and her husband liked this deal.

Besides finding the right lender and having a steady income, Monty and her husband still needed to save some money. They saved money whenever they could, monitored their spending, and worked extra jobs - what Monty calls ''side hustles.'' ''My husband is a teacher and a personal trainer, so he had clients that he worked with three times per week. And I used to work for a cosmetics company, so I did makeup for people.'' The money Monty and her husband made on these side hustles all went toward saving for a house. Also, instead of going out to dinner, ''We'd host game nights at our house and serve light refreshments.''


If you're a millennial, it might appear at first glance that buying a home is out of reach. But, as you can see, other millennials achieved this goal, and with no financial help from family members. You might need to use some creative methods, such as moving to a less expensive area (which is what my husband and I did when we bought our first home) buying a fixer-upper, or just being frugal for a while. But if homeownership is your dream, it's good to know that there are ways you can make your dream a reality.


See what BESMARTEE’S SMART MORTGAGE can do for you.

Real Estate Commission: Explained, Revealed and Compared
By Arvin Sahakian · Aug 17, 2015 · Real Estate Data

Real estate agents receive commissions from home buyers and sellers, collectively earning over $50 Billion per year. Learn how commission amounts are set, who pays them, and how they work in this article. Read more.


California Property Tax: Complete List by County 2014-2015
By Tim Nguyen · Nov 26, 2014 · Real Estate Data

List of secured property tax rates for all counties of California fiscal year for 2014-2015. Read more.


California Proposition 60 and 90: Your Complete Guide
By Tim Nguyen · Nov 28, 2014 · Real Estate Data

If you live in California and are over the age of 55 you can effectively reduce your property taxes when buying a new home. Read more.


Houston vs. Dallas: Which One is Better to Live in?
By Amanda Curry · Oct 11, 2016 · Real Estate

Houston Vs. Dallas? If you are considering moving to either of these major metropolitan areas, we've created a resource to help you make the decision process a little easier. Read more.


What to Expect During the Home Loan Closing Process
By Arvin Sahakian · Feb 24, 2015 · Mortgage

You've heard the term used before, but what does loan closing mean? Find out all you need to know about the process. Read more.


5 Illegal Borrowing Activities: Things That Are Illegal When You Try to Get a Home Loan
By Laura Agadoni · Jan 22, 2016 · Mortgage

Whenever there is money to be made or money to be spent, some unscrupulous folks will take advantage, trying to game the system or commit all-out fraud. Read more.


The Surge in Foreign Real Estate Investment in the United States
By Laura Agadoni · Feb 24, 2016 · Real Estate

Foreign real estate investment in the United States, both commercial and residential, is a huge phenomenon that is only expected to accelerate, maybe even to skyrocket, in 2016. Read more.


Does Homeowners Insurance Pay Off your Mortgage if the House is Burned Down?
By Amanda Curry · Feb 8, 2017 · Mortgage

In this article, we explore how homeowners insurance works and what happens in the event of a house fire. Read more.


16 Ways to Improve Your Debt-to-Income (DTI) Ratio
By Veronica Nguyen · Nov 29, 2014 · Mortgage

Your DTI is used by mortgage lenders to determine whether you qualify for a loan, and if so, for how much. Improve your DTI with these 16 tips. Read more.


6 Creative Financing Solutions For Your Next Home Purchase
By Laura Agadoni · Mar 22, 2016 · Mortgage

In this article we explore some creative financing options for your next home purchase. Read more.