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    A Wise Investment

    If students are  looking for cheap housing, they might want to consider vacating the rental market and investing in a house.

    Normally, home buying is almost out of the question for a student. High interest rates and the steep monthly payments that come with them generally leave apartment renting or dorm rooms as the only options.

    According to Lori Taylor, a local lender who works with Ranlife, home mortgage rates are lower than they’ve been in over 30 years, meaning monthly house payments are becoming more manageable. Whereas five years ago a $100,000 home would cost someone close to $1,000 a month, today they could be paying just over $500 a month. Considering that any decent apartment with two bedrooms charges over $700, home buying is becoming a more realistic option for students. Even with the low rates, however, home buying isn’t a great choice for everyone.

    “Lenders are very strict because of the recent mortgage meltdown and bailout,” said Taylor. “There used to be literally hundreds of lenders so it was easy to find someone to lend money for almost anyone regardless of credit or income. Now there are only five lenders. Those lenders require a lot of documentation. They want to be sure they are lending money to a strong and responsible buyer to protect their investments better.”

    A mortgage requires anywhere from 10 to 30 years to pay off, so it’s a commitment not to be taken lightly. A student looking to graduate and move out of Utah might not want to be saddled with a mortgage.

    For some students, school takes up too much time to be able to work enough hours to pay for a home. Morgan Tyler, a junior attending WSU, looks forward to when he will be able to afford one.

    “I’m taking 15 credits right now, and the hours that each class requires makes it impossible to work a full time job. If I want to get decent grades, I can only work part-time, and I’m sure I can’t afford a mortgage payment.”

    Also, even though interest rates have fallen dramatically, many lenders have gone out of business due to the economic slump, resulting in very limited options when considering where to go for your loan. Thus, without competition, the remaining lenders have much more freedom in what they can require from a home borrower.

    Basically, lenders need a decent credit score and steady income. If someone doesn’t qualify on their own, some lenders allow a cosigner.

    When someone decides that buying a home is right for them, the first step they should take is finding a good agent. According to Cindy Harris, an agent for Lady Bug Realty in Ogden, there is a lot of fine print that most people don’t even consider.

    “Most buyers don’t realize all the complications that can arise without an agent trained to protect their interests,” she said. “People need to plan ahead. Pretty much every lender is going to require at least 3% down on a home, so it’s something they need to consider before they decide to move forward.”

    Perhaps the biggest obstacle to buying a home is the time it takes to get into one. However, getting an agent and finding a lender early on can relieve the majority of stress off students’ shoulders.

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