Illustration by Rachel Maves
Maybe it was the hours spent playing house in the lofted treehouse bunk bed my dad made for me. Or maybe it was my early infatuation with TLC’s “Trading Spaces” and then HGTV. Or maybe, as my Aunt Kay suggested, it was genetic.
“You don’t have to explain it to me, Sarah,” she said with an understanding smile. “You and I are the same. We’re nesters.”
It didn’t feel extraordinary to dream of buying a house at age 24. To turn that dream into a reality, however, I needed more than a gut feeling. Here’s what I learned over the course of the home-buying experience that helped make my dream come true.
First, you don’t need a 20 percent down payment to mortgage a house. That’s the biggest misconception for first-time home buyers, according to Ingrid Sell, a senior loan officer at Village Bank.
Sarah Lockwood’s nesting instincts kicked in early.
“In fact, if you’re a first-time home buyer, the down payment is less of an issue,” says Sell, who has worked in mortgages for 24 years and was, full disclosure, my mortgage broker.
The other misconception, she says, is that you need a perfect credit score. A loan officer’s job is to confirm that you can afford the loan you are applying for and have a history of paying your bills on time.
“We’re not looking for perfect credit for seven years,” Sell says. “Everyone should shoot for that of course, but life happens.”
With lower credit score and down payment requirements, Virginia Housing Development Authority (VHDA) and Federal Housing Administration (FHA) loans are popular first-time home buyer financing options. There are also many grant options available for first-timers through the VHDA and Federal Home Loan Bank. But know this: if you don’t put 20 percent down, you will likely have to pay private mortgage insurance (PMI) with your monthly house payments. Depending on the type of loan, PMI could be required until you’ve reached 20 percent equity, or for the entire life of the loan.
For me, the PMI was worth it. With just under $1,500 (or about 1.3 percent) down, I was able to buy a humble rancher with a monthly mortgage payment lower than the rent I was paying for a third of an apartment in The Fan.
While most of my parents’ friends congratulated my “smart move,” people my age — call us millennials if you must — assumed I was the epitome of an adult, graduating beyond the ramen-for-dinner years and doing something unimaginable, even crazy.
The truth is probably somewhere in the middle. Being a newly minted homeowner doesn’t mean I’m swan-diving into a sea of cash, Scrooge McDuck-style. But, I hope to build equity that my future self will thank me for.
Near South Side’s Westover Hills and Forest Hill neighborhoods, in a small community officially called Forest View Heights, my house is not the worst on the block, but it has required major work to make it home. I invite you to follow along as I rip out the carpets, learn how to install light fixtures (and how not to), mow my first lawn and play nice with the neighbors.
