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Divorced Women and Home Ownership by Gina Scrivener
My mother called me this morning ecstatic that her home loan had gone through. I congratulated her and listened intently as she told me about the deal. She said she got it at over ten grand below asking price with no closing costs because the seller paid them. Then she thanked me for walking her through some of the steps to get it done. To some, this may not seem like a big feat. But to other’s, like my mother, it is enormous.
She’s 54 years old. She has been married and divorced five times. Yes, five times. I think she gave up looking for the ‘right man’ a long time ago and settled for the ‘safe man’ whom she would eventually regret marrying. Each time, she would walk away with the same personal possessions; her furniture, her clothes, shoes, dishes, toiletries, and car. No home.
There are many women these days that are divorced, raising children (my mother adopted two, working on the third) and working full time who believe that owning a home is out of their reach, so they don’t bother. My mother had it in the back of her head for quite some time and mentioned it frequently. I always told her that it was not only a good idea, but necessary to help her retire.
Home ownership is not ‘just’ about owning a home. It is about security, retirement, saving money instead of throwing it away. Every time you pay rent, you throw money away. You are paying for someone else to own a home that they can continue renting out or sell for profit. In simple terms, you are paying for their retirement, not yours.
If you are paying rent, you can pay for a home loan. Right now, with the interest rates hanging between 5-8%, owning a home is either cheaper than rent or right at the same cost. My mother’s new home is in a small town in Oklahoma. She was paying $500 per month on rent. Her new loan is going to run her $540 a month until she refinances in a couple of years to get rid of the PMI.
PMI is short for Private Mortgage Insurance. You purchase PMI on some loans in order to qualify for lower down payments. It protects the lender in case you default. Some loans do not require this. When shopping for a loan, this is one thing to ask the lender about. If you have the traditional 20% down, odds are you will not be required to have PMI.
Once my mother refinances and gets rid of the PMI, her house payment will be approximately $100 less than what she was paying for rent. That’s a plus.
But there are more:
* Owning a home can increase your credit rating if you make your payments in a timely fashion and don’t fall behind in any other bills.
* After you’ve paid down a home loan to a certain extent, you have “equity,” that you can borrow against to do other things with, LIKE: STARTING A BUSINESS.
* You can sell your home when you no longer have children living with you, get a smaller home, and pocket the cash, or do something else with it, LIKE: STARTING A BUSINESS.
* You can get a reverse mortgage when you are old enough to qualify and have extra income for living expenses while you are still allowed to live in the home until you pass away!
Credit problems are still an issue these days. But it is nothing like it was in the past. You can generally expect that with a score above 600 you will not have any problems getting a loan with a slightly higher interest rate. Since the sub-prime loan fiasco, lenders aren’t charging an arm and a leg in interest, they are just being more careful not to lend to people whose score is below approximately 580 or taking extra precautions when lending to persons with lower credit scores, such as, including PMI in the loan.
There are definite advantages to owning a home. And it is not that hard to get it accomplished. Do your homework, apply with SEVERAL different credible lenders and ask a lot of questions.
*note: It does not lower your credit score to shop around for lenders. The credit reporting agencies will be aware that if several inquiries come in from mortgage lenders in a short time frame, that you are shopping for the best deal and will not penalize you for this after the initial inquiry.
Gina Scrivener
http://www.wahmsunite.com/forum/index.php?topic=164.0
About the Author
Gina Scrivener is the owner of http://www.wahmsunite.com, a legitimate online community and resource center for work at home mom’s. She owns local as well as online businesses and has a background in staffing and operations management. She provides legitimate work at home job information on Work At Home Mom’s Unite free of charge for those looking for assistance.
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