More Kids Seek Help from Parents and Relatives

I was speaking to a relatively new loan officer from a bank that sends me business on a regular basis. He called me with a referral and then commented that so many of his loans involve gifts from parents and other relatives.

In our conversation we discussed if  it was the same a few years ago. The simple answer is, no. There is no other time that I can remember were first time home buyers are looking to parents and family to help out with down payments, closing costs and/or as co-signers. Unfortunately many parents and family can’t help out.

I see so many reasons for this to be going on with first time home buyers:

1)    Fewer good job opportunities, even with a good education.

2)    Student loan debt.

3)    Less or no over-time available.

4)    Reduced hours, often to part-time status.

5)    With less opportunity for income, more debt is created.

6)    The ability to save becomes more and more difficult.

7)    The price of gas uses continues to hurt the ability to save.

With all these issues, many first time home buyers are postponing or see their ability to purchase a home as almost impossible.

I spend a lot of time coaching first time home buyers on ways to stretch their dollars, how paying off certain obligations and, last but not least, things they may have to give up in order to own a home.