Many Veterans and military members searching for homes in 2022 experienced challenges finding the home of their dreams. The market started with low housing inventory and high competition, and now high inflation and equally high mortgage rates.
To help those searching for a home, we’ve put together a handful of our favorite resources Veterans can use to help navigate the current homebuying market.
1. Budgeting Advice from The Military Wallet
Now more than ever, a budget is essential to help determine what you can reasonably afford when searching for a home. A budget can help you to set limits on your spending, track your progress towards your savings goals, and make informed decisions about where to allocate your money.
Ryan Guina at The Military Wallet wrote this essential guide on how to track your money and create a budget that prepares you for anything life throws your way.
2. Determine Your Payment with this VA Loan Calculator
One of the most powerful VA benefits is the VA loan. Eligible Veterans, service members and spouses can purchase a home with $0 down payment and no PMI.
A basic mortgage calculator won’t give you the correct estimate, as they don’t typically provide calculations for having $0 down, no PMI or the VA funding fee. We found this VA loan calculator from Veterans United especially helpful for determining monthly mortgage payments and viewing the complete amortization schedule.
3. Rent or Buy?
With mortgage rates at 20-year highs, many are asking if they should buy now or wait. The trick is this isn’t a one-size fits all answer.
Homeownership is a better option in many cases – you build equity, home prices appreciate with inflation and mortgage rates may be elevated for multiple years. However, it’s not the best answer in every case.
The New York Times rent vs. buy calculator does a great job breaking down costs and helping potential homebuyers decide if they should buy or wait.
4. HUD Homes (REO)
An REO property is a property that has been foreclosed on and repossessed by a lender. The term REO stands for “real estate owned.”
You may be able to find a great deal on an REO property, and the U.S. Department of Housing and Urban Development (HUD) provides a listing site for REO properties here. The site specifically offers homes acquired by the U.S. government due to foreclosure of an FHA loan.
While you may be able to find a deal on a foreclosure, keep in mind that the home may not be in the best shape, and you may have out-of-pocket costs to get the home up to a living standard.
5. Keep Track of Current Mortgage Rates with Freddie Mac
Freddie Mac is what’s known as a GSE or government-sponsored enterprise. Freddie Mac exists to purchase mortgages from banks and lenders to help stabilize the market and provide liquidity to these mortgage providers so they can continue to offer mortgages.
Freddie Mac also provides mortgage rate data and weekly averages all the way back to 1971. This resource can help you keep an eye on the market and where it is trending. The downside is they don’t provide details on VA lending, which can find from Optimal Blue – a subsidiary of the mortgage technology firm Black Knight.
The mortgage market right now is tough for Veterans and civilians alike. However, with the right resources, you can confidently navigate the market and make the best financial decision. Do you have a specific resource you like? Let us know in the comments below.
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