Rental Hack: Buy a House

Listen y’all, if you have the qualifications to rent but these sky high rental prices are preventing you from doing so, just buy a house. ;)

Okay, Okay. I can hear some of you saying, “But it’s not that easy.” Actually….it’s a lot easier than you think. If you can qualify to rent, odds are very much in your favor that you’ll be able to buy.

So let’s break it down. Many of you continue to rent simply because you and other people in your life just don’t have much experience in buying. That lack of experience can then make you think you aren’t capable or can fill your head with misnomers. So, I’ve created a little chart of common misguided thoughts and ways that you can flip those thoughts in your favor.

Limiting Thoughts	Homeowner Thoughts
There’s no way I can save up for a 20% down payment.	I actually only need to save up 3% for a conventional mortgage or 3.5% for an FHA mortgage.
Even at 3%, I don’t have the money for a down payment.	​If I can find $3000 (security deposit plus first month’s rent) to move into a $1200 rental, then I can definitely afford a 3% ($3000) down payment on a 100k house.
If I use all of my money for a down payment, then I won’t have any money for closing costs.	I could use the $3000 I was going to use for a down payment as my closing costs. If I need more than $3000 for closing costs, I can restructure my offer to have the seller pay for some of my costs. Then, I can use a down payment assistance program to cover my down payment.
I don’t even know where to start.	Most people don’t know where to start when they buy their first home….that’s why they hire a realtor. Once I find a realtor to work with, he/she will walk me through the process every step of the way.
I don’t have the money to hire a realtor.	Realtors are free to me when I buy a home. I only have to pay for a realtor when I sell.
I’m pretty sure my credit is too low to get a mortgage.	My credit isn’t that bad. Since I have over a 580, I can get a loan!
I’m pretty sure I have too many bills to get approved for a loan.	I should actually just work with a lender to let him/her determine if I have too many bills. As long as all of my loan/credit card payments plus what my mortgage payment will be do not exceed half of my gross monthly income, I should be good to go. But, if my bills are too high, then I can just work hard to pay off a loan or two, or I could find a second job, or I could add a second person to my loan.
There aren’t any houses available in my price range, and all the ones that are, are fixer uppers.	I should actually just work with a realtor to let him/her determine what’s on the market and what’s not. I’m sure there are more available homes than I think there are. Plus, there are always hidden gems that pop up out of nowhere.
Based on what I can afford right now, I’m going to have to settle for a small house that doesn’t match my dreams. I’d rather save my money and bide my time until I can afford what I really want.	Who knows when I’ll be able to afford my dream home. I might as well purchase what I can afford now and then just trade up when I can afford a better house. Since I won’t be throwing away my money on rent, I can use the profit I make from the sale of my small home towards the purchase of my new one.
If I buy a home right now, I’m going to be screwed later when the market crashes.	On second thought, today’s situation isn’t anything like the housing crash of 2008. So I’m pretty certain that even if the market takes a downturn, we won’t experience a crash again. If the market does fall, that’s okay because I will get a fixed rate mortgage which won’t be impacted by a change in interest rates. Also, if my home value lowers, that will only concern me if I try to sell, at which point, I have options.
As much as I’d love to buy a home, I can’t commit to homeownership right now. I’m just not ready to be stuck with a whole house.	​Well, if I really need to make a life change, I can just sell my home and find another one. If home prices eventually fall and I can’t make a profit on my sale, then I can just rent out my home and purchase another one.
If I have to rent out the home I buy, I won’t be able to get an approval for a second mortgage.	​Ya know what, investors do this stuff all the time, and some of them don’t even have a traditional income to support all those mortgages. If they can do it, surely there’s a way for me to do it too. I’ll just have to talk to a realtor about it.
I can’t afford a major repair if something goes wrong with the home.	I can always find a contractor that utilizes financing! :)

So you see, homeownership is within your grasp. If you really want to purchase a home, you can make it happen.