Jocelyn Vasquez, a determined Hispanic woman, knows what she wants: Financial wealth through homeownership.
The L.A.-based mortgage agent was three years ago on the verge of her dream of purchasing a home before she turned thirty. She was 28 years old, single and didn’t want to let anything like a lack of a 20% down payment stop her from buying a home.
Like many others, her parents believed she should wait until she had enough money to save more. Jocelyn was different.
“I did my homework and knew using mortgage insurance (MI) would allow me to make as low as a 3 percent down payment,”She explains. “I bought my townhouse for $278,000 and put down $13,900. It would have taken me almost eight years to save $55,600 for a 20 percent down payment! As it was, my 5 percent down payment used up most of my savings.”It was a good decision that paid off after a few years. Her home appreciated substantially due to the low interest rates and high demand for housing. She sold her townhouse for $86,926 in March 2020.
“Imagine if I had waited eight years to save for a 20 percent down payment!”Jocelyn is a marvel. “I wouldn’t have been able to get my foot in the door of homeownership when I did.”
Jocelyn was able move up to a bigger house in Simi Valley after her townhouse was sold. Jocelyn and other buyers typically have enough equity or profits from the sale to pay 20 percent down when they move up.
Jocelyn, a former mortgage insurance worker and loan processor, decided to break with the current trend and use MI again as a financial tool.
Jocelyn bought her second home in spring for $537,000. Despite having enough money for a 20% down payment Jocelyn paid only 11 percent, or $60,000.
“In my last house, I cut myself short by using almost all my savings for my down payment,” Jocelyn explains. “I didn’t want to do that this time around. I knew my new house needed some repairs and updates. Plus, I was purchasing it during the uncertainty of the pandemic, and I wanted to have ready cash in case I lost my job.”
This decision allowed her to remodel her kitchen, purchase furniture, and pay off two credit cards while still having savings for the unexpected.
Jocelyn felt she made a good investment by purchasing a larger house in an even better location. Four homes in her area, similar to hers, sold for between $550,000 and $560,000. This likely helped her increase her equity by $17.500 in just six months. She may be able to cancel her MI soon.
“I try to educate people about all the tools and resources available to homebuyers,”Jocelyn. “I tell them, ‘I’m living proof.’ Had I waited those eight years to save for a 20 percent down payment, I would have missed out on all this money and the perks of being a homeowner!”
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