Family Life After the Mortgage : 10 Common Scenarios Now
Bubble or No bubble, Real Estate from the time of the Baby Boomers has totally changed now. Some are even saying that with today’s prices, the present generation will mostly be renters. The inflated real estate prices are way too difficult for most people to pay off.
However for many young families, a house is still the best form of security they can give to their children. Having a family does not come cheap nowadays. But, having your own house for your family is a privilege that only a few can comfortably afford.
An article in the Active Rain Blog,"California Real Estate and Young Couples" by Scott Gormley best described the sentiment of the younger generation of home buyers. He discussed that during the time of their parents, homes are being sold for the average price of a car these days. The interest rates were higher and the wages were lower…but the prices were affordable. Now, the prices are so inflated that the affordability factor is only 12 - 14%, meaning only 12 -14 people out of 100 can really afford a home.
"Now we must work more hours, invest wiser, find higher paying jobs, save more and have a great budget in place…Not an easy thing to do with my generation. One that has a "have it now" personality…That’s right…Have it now…pay for it later!"
Furthermore in an article in the Inman Blog, "Today’s Mortgage: Treasured Family Heirloom", new loan products are being launched to add more burden to today’s generation. Imagine inheriting debt instead of assets! Mortgage Debt is being passed on to the younger generation with the hope that sometime in the future the value of the property will be greater than the debt.
Thus, today’s young couples and families are getting more creative to find ways to afford a home.
Here are 10 common scenarios that families have to deal with to pay for their mortgage.
- Having a nanny / sending children to day care / asking grandparents to help in taking care of the children because both parents have to work to pay for their mortgage.
- Having double jobs.
- Living on a strict budget.
- Renting the garage to another family to pay for the mortgage.
- Living like sardines in a home, because it’s the only property they can afford
- Having interest-only home loans.
- Renting a portion of their home to a relative to help pay for the mortgage.
- Maximizing their credit card limits for other expenses.
- The number of kids in the family becomes a question of how much they can afford, while paying for the mortgage.
- For those who have really struggled, foreclosure is inevitable.
How about you, how do you balance your family life and paying for your home mortgage? Do you have any tips for those who are struggling to pay for their home loans?
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