National Association of Minority Mortgage Bankers of America (NAMMBA) founder and CEO Tony Thompson, along with Cultural Outreach’s director of multicultural marketing Merissa Khumalo, joined MGIC for a 60-minute webinar to share insights and best practices for lenders and originators selling to the millennial market.
Tony and Merissa outlined 4 common myths that may be holding millennial homebuyers back – and how to help debunk those myths. Mortgage professionals can reach these digital natives by sharing straightforward information on social media and other online venues.
Myth 1: “I need a 20% down payment.”
While mortgage professionals know there are many low-down-payment mortgage options available, many millennials mistakenly believe they need a 20% down payment to get a mortgage. They may not know about low-down-payment options like mortgage insurance or down payment assistance, or they may feel overwhelmed by misinformation.
Debunk the myth with these resources:
- Mortgage myths series
- Get Ready guide on down payment options
Myth 2: “The financial crisis will happen to me.”
Many millennials entered adulthood during or after the financial crisis, which planted seeds of fear about homeownership. You can play a role in helping millennials understand that while economic downturns do happen, they don’t have to prevent homeownership. Focus on transparent financial education for millennials, helping them navigate possible fears instilled through exposure to impacts of the 2008 housing bubble collapse.
Debunk the myth with these resources:
- First-time homebuyer resources library
- True homebuying stories from other millennials on readynest.com
Myth 3: “I can’t buy a home with student loan debt.”
It’s a common belief that student debt is a complete barrier to buying a home. But of course, many millennials have managed to buy homes despite having student loans. Show potential borrowers how homeownership can fit into their specific financial situation and help them explore all their options. Explain the importance of building wealth through real estate, and the potential cost of waiting to buy until after paying off student loan debt.
Debunk the myth with these resources:
Myth 4: “I need to wait until I’m ‘ready’ to buy a home.”
Millennials worry they need to have their lives in perfect financial order before they can buy a home. Concerns about having a perfect credit score or eliminating debts may keep them on the sidelines. But an “ideal standard” is a myth in and of itself. Guidance by mortgage professionals can help potential borrowers understand that each family’s path to homeownership is different.
Debunk the myth with these resources:
- Homebuyer readiness quiz on Readynest
- Your Road Home infographic
Throughout the webinar, Tony and Merissa emphasized the importance of educating potential borrowers and acting as a trusted advisor. By debunking these myths, loan officers and lenders can help millennials feel more empowered to take steps toward homeownership. Watch the recorded webinar for yourself!
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