Laurie’s journey from renting to homeownership
It's a daunting task to realistically assess your personal finances and work toward a down payment for a home, but that's exactly what one Harrisburg woman did when she made the decision to go from renting an apartment to buying her first home.
Laurie was renting in downtown Harrisburg but had her heart set on raising her family in more child-friendly Swatara Township just outside the city. “I was about 26, had two kids -- one who was very young,” shared Laurie. “I knew I didn't want to live in an apartment for a long period of time. I wanted to buy a house in a neighborhood.” With that in mind, Laurie researched several local and state programs to become more educated about the homebuying process and saving for a down payment.
“I took a course offered through Tri County Community Action of Dauphin County, which offered a certificate for $3,000 upon completion that I pay off once I sell the home,” Laurie said. While the course offered a refresher on information about personal finances and the homebuying process, Laurie really benefitted from the loan certificate.
Unfortunately, the certificate was not enough to cover the entire down payment, so Laurie also created a strict budget to save for the remaining closing costs. This was not an overnight process, but a long-term plan of action. “I really buckled down and stuck to a budget for a few years, and I was able to save enough for a down payment,” Laurie explained. “With PHFA's program, it only required about 1 percent down, so that was awesome.”
In Laurie's particular case, she was eligible for a Keystone Government Loan through the Pennsylvania Housing Finance Agency, a loan under which eligible borrowers can contribute the lesser of 1 percent of the purchase price or $1,000 toward the transaction.
Laurie tackled the budgeting challenge knowing she was saving for her family's future. “Anything I didn't need beyond basic food for cooking, or clothing, if it wasn't something we absolutely needed the answer was 'no.' I buckled down at Christmas time,” shared the mother of two. “While [my children] might've missed out then, in the long run they might not remember they didn't get a few things for those Christmases. But they'll remember the house they live in.”
During the saving period, Laurie spent time familiarizing herself with the homebuying process so that she was better prepared once she had secured enough money for a down payment. After two years of careful budgeting, Laurie had saved enough to comfortably make a down payment and offer on a home. She began to work closely with a lender, who was able to get her approved for a PHFA loan to purchase her first home.
Aside from saving for the upfront costs of owning a home, Laurie highlights the importance of saving up and/or being aware of the costs of maintaining a home you own. About a year into living in her new home, Laurie explained, “my entire HVAC system went, and it was so old it wasn't cost efficient to repair it.”
Laurie once again researched her options so that she could make an informed and financially sustainable long-term decision. “I was looking online and found this [Homeowners Energy Efficiency Loan Program] through PHFA, which was a 1 percent loan over 10 years. Without it, I would have gone over six months without cooling because of the cost.” Using a HEELP loan, Laurie was able to replace her broken heating and cooling system with an energy efficient unit and then gradually pay off the low-interest loan.
These days, Laurie and her two boys are happy living in the home for which she painstakingly saved. They were able to purchase a home with a yard where the family — and their dog — can romp around. Looking back on her homebuying experience, Laurie believes that being proactive in her research and saving for the down payment, as well as finding state and local assistance programs, was invaluable.
For more information about buying a home, including free homebuyer counseling and education courses, visit PHFA.org or call toll-free 1-855-827-3466; press “0” when the recorded prompts begin.