Buyers Will Spend More, But Probably Be Stressed Out

Aug 19, 2020

How much home buyers will go over budget chart

Senior Editor

Originators take note: you might be able to convince your clients to take out bigger mortgages. A new survey shows almost two-thirds of Americans are willing to spend more for their dream home. A significant number, though, find the whole process stressful.

A Lending Tree study says more than 6 in 10 (64%) homebuyers are willing to go over budget for their perfect house.

This sentiment is especially true for millennials, as more than 3 out of 4 (76%) of respondents ages 24 to 39 said they’d stretch their budget to buy their dream home. Seventy-four percent of men agreed.

“I urge homebuyers to be very cautious about going over budget. Many people underestimate the maintenance costs of owning a home,” said Tendayi Kapfidze, LendingTree’s chief economist. “If you are stretched financially and underinvest in maintenance, it can diminish the value of your home.”

Originators should also note how stressful certain groups are about securing their mortgages. Black and Hispanic homebuyers were about twice as likely, at 16% and 18%, respectively, as white buyers (9%) to say applying for a mortgage is the most stressful part of the homebuying process.

More than 1 in 10 (12%) buyers said that they didn’t feel their mortgage lender was effective at explaining their available loan options.

About the author

Keith Griffin

Senior Editor

Keith Griffin is a senior editor at NMP.

Link copied

Published

Aug 19, 2020

Analysis and Data

Mortgage Industry Despairs Over Positive Jobs Report

Leading to 'crushed' expectations of another significant rate cut

The September jobs report came back with flying colors, adding far more jobs than Wall Street economists projected while the unemployment rate ticked down, leading to what can only be called a crushing defeat for mortgage professionals. In response, the average rate for the ...

People On The Move

Pennymac Shakes Up Capital Markets Team

William Chang, Pennymac’s long-time capital markets leader, to "pursue other interests in the mortgage banking industry."

PennyMac Financial Services, Inc. and PennyMac Mortgage Investment Trust announced Thursday that William Chang will step down from his roles as Senior Managing Director and Chief Capital Markets Officer at PFSI, and Senior Managing Director and Chief Investment Officer at PM...