Illustration: Hunter Newton/Bankrate
While most 24-year-olds are preparing to leave the warm embrace of their parents’ health insurance, Jocelyn Becerra had something else in mind. It’s about becoming a homeowner.
Two years ago, after spending a year saving money, Becerra bought a house in Bentonville, Arkansas. She took another job and put all of her extra income toward the down payment. “For a whole year, I focused all my energy on it and put my head down,” she says of her savings process.
Setting the stage for home buying
For many young homeowners, the housing market may feel out of reach. According to Bankrate’s analysis, people earning the median income in the U.S. can effectively put 3 out of 4 homes on the market. “For many young people in this country, buying a home feels like a given,” says Bridget Venus Grimes, CFP®. “But it’s a really tough market. In most places, it’s just insanely expensive.”
Becerra couldn’t do anything about home prices, but he could cut expenses to increase his income and save for a down payment. This was a significant first step for first-time homebuyers.
I have been working hard for a year.
— Jocelyn Becerra
Behind the scenes of her home buying experience
It’s a simple plan on paper, but it’s far from easy. Becerra sacrificed about nine months of his life, evenings and weekends outside of his 9-to-5 marketing job, to save up for the down payment. “I was willing to do it to get this long-term result,” she says of homeownership.
The down payment was the main hurdle she had to clear. She did some research and found that the monthly rent in Bentonville is comparable to a monthly mortgage payment. “If you’re going to pay rent, you might be better off trying to own a place where you can do what you want and put down roots, especially if you’re going to pay rent,” she explains.
She financed her home through Builder’s Preferred Lending Company at an interest rate of 6.875%, which is higher than her current mortgage rate, but hopes to refinance later. The lender offered her a $10,000 incentive toward closing costs, which she used to purchase mortgage points to secure a lower interest rate.
Becerra said she was focused on saving for a down payment and didn’t prioritize other financial goals, such as retirement savings. She is currently focused on growing her brokerage account. As Becerra struggled to raise the down payment, he realized there was more within his financial reach than he had previously thought. “It’s a matter of mindset,” she reflects. “It was difficult, but I was able to do it. I want to keep that feeling.”
her dream of homeownership
Becerra loves having a space that is truly his own, which he can decorate to his heart’s content. You’re financially responsible for the entire building, but what happens if the roof leaks or a pipe bursts? — That can be scary, she says, but it’s a worthwhile tradeoff.
Becerra’s address may change someday, but he knows he’s found a home in northwest Arkansas. Although she doesn’t want to be a landlord, she is open to converting her current residence into an investment property someday. “I love the idea of having multiple homes in this area, because I’m very familiar with this area and I think it’s a great place because a lot of people have been moving here recently,” she says.