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How to Buy a Home in Your Early 20s

Do you think you’re too broke to buy a house in your 20s? The truth is, you don’t exactly need a million dollars to buy a home. Most millennials and Gen Zs don’t prioritize purchasing real estate for two reasons; first, they want to wait for marriage, and second, they want a low-maintenance lifestyle, and homeownership doesn’t fit that. 

Buying a house is something we never learn about in school or college. Owning a home is an excellent investment that can earn you some residual income. If you are not sure of anything about buying a house, check out our article on buying a house for the first time. Apart from that, here’s how you can make buying a home a reality in your 20s:   


Buying a house means paying a mortgage every month, just like you would pay for rent every month. That means you should be able to afford those payments and save for a downpayment, which could be a lot. Experts recommend you have enough money to pay up to 20% of the house’s total price, which could be a lot depending on the cost of your home. 

Start your savings early; save money you make from your part-time jobs at college. Spend less on vacations, and prioritize your spendings on the most important things only. If this is a possibility, ask your parents for assistance for the down payment. Other than that, if you’re lucky enough, you could qualify for one of the many down payment assistance programs available nationwide. 

Have a stellar Credit Score 

In the finance/mortgage world, your credit score determines everything. Ranging from if you will get a loan to how much interest you’ll be paying. Most college students don’t pay attention to their credit score in their early 20s but think of a credit score like a recommendation letter from your professor to get into graduate school. 

When buying a house, your lender will require a good credit score to even lend you money, and; the better your credit score is, the less interest you will pay. Start paying down your debts, beginning with your highest-interest ones first. If you have any collections to your name, settle those, and make sure your accounts are in good standing. You should also pull your credit report and check for any errors. If any, report them to the credit bureaus so your credit score can be improved.

Shore up Student Debt 

If you just got out of college, the chances are that you have student debt. Although having student debt doesn’t prevent you from getting a house mortgage, many mortgage lenders require that your debt to income ratio be no more than 36%. This basically means that your total debt, including student loans and house mortgage payments, cannot be more than 36% of your monthly income. 

If you can, you should pay off larger amounts of student loans, which will make your monthly payments smaller. You can also extend the lifetime of your student loan which will result in smaller monthly payments. This will allow for some more room for your house mortgage. 

Buy a starter home

You don’t have to buy your dream home just yet. If you prefer living in a city you should start by investing in an affordable area and rent that place so that the property pays by itself. Plus, if you get a condo in the city or in a more expensive area, you’ll be paying a lot in your monthly mortgage and you don’t want to be “house poor”. A starter home will be your stepping stone to actually buy your dream home in the future. 

Avoid any unnecessary expenses 

If you’re serious about buying a home in your early 20s, stop spending money on any unnecessary things. Cut down your travel expenses, don’t buy any expensive cars, make a clear monthly spending budget, and start cooking your own meals. This will accelerate your process for saving for a down payment. 

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Mark Trompeter

Jersey City's Unofficial Mayor! Mark offers over a decade of experience in luxury Jersey City and Hoboken real estate. He's been ranked Weichert, REALTORS® top 10 sales associates consistently for the past several years, and has generated approximately $75 million in real estate sales throughout the course of his career. With a degree in communications from Hofstra University, Mark instills in his team the values of communication, contact and total availability for clients. Born and raised in New York City, and a Jersey City resident for over a decade, Mark knows the city better than anyone and is often referred to as the "unofficial mayor" by many neighbors and locals with whom he's developed lasting relationships. His experience in premier residential real estate over the past 16 years, and expertise in marketing and sales for over 20 years, has given him the ability to understand and navigate the many complex transactions in real estate. From new construction, to high rise condominiums or multi-family homes Mark brings a unique real estate perspective with his long-time experience in the field, and passion for the communities outside his front door.

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