Although the housing market has been in recovery over the last few months, rising levels of student loan debt is a concern over the long-term for the real estate market, and the economy as a whole.
Rising student loan debt has been a contributing factor to the growth in multigenerational living. If kids graduating from college are saddled with debt, many of them will have no choice, but to move home with their parents.
This trend might affect housing down the road, because it may take time for many of these young adults to be in positions where they can afford to become homeowners.
Here are a few recommendations for new college graduates:
Investigate Student Loan Consolidation/Forgiveness programs. American Student Assistance, for example, is a non-profit organization that can provide information about these types of programs.
Consider Used Cars Over New. Having reliable transportation back and forth to work is important, and many young graduates will need dependable vehicles. But new cars often means higher depreciation values, and higher payments. Save money by investing in a reliable used car offering lower car payments.
Avoid Carrying Balances on Credit Cards. Each dollar that goes toward interest and debt payments is one less dollar available for saving and investing.
If possible, live with parents for the first few years out of college. Living expenses can make entry level paychecks disappear quickly. Avoiding some of these costs, and save the money left over.
Even though there are Federal programs, where first time home buyers can get financing for little or no money down, good financial management becomes important when it’s time to apply for that first mortgage.
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For more information, contact:
John P.Kreiss, REALTOR®, SRES®, e-PRO®
Prudential Prime Properties
125 Turnpike Rd. #7
Westborough, MA 01581
Direct: (508) 826-6920
Fax; (508) 329-1303