LAS VEGAS (KTNV) — Mortgage rates have hit a 21-year high, making home ownership unattainable for many.
But a local company is making it more affordable. I followed up with Roots Homes for a possible solution to help buyers who are in the market get a better rate.
"How difficult is home ownership right now, especially here in Vegas?" I asked Austin Parker, who is looking to buy a home.
"Super difficult, especially if you don't have a sky-high income," he said. "You are not qualifying for any of the same houses you would two or three years ago."
Parker is looking to buy his first home. He says he has been looking in Las Vegas for nearly a year. But with interest rates close to eight percent, he says the monthly payment is unrealistic.
"Depending on the house, (a monthly payment would be) $3,000 to $4,000," he said.
Parker says he was scrolling online and found a solution to his problem through Roots Homes.
"It makes it really easy for buyers to move into a home for as low as 2 percent," he said.
Lauren Self is the founder and CEO of Roots Homes. I first met her back in February, when she first launched her company which allowed buyers to rent, build equity in a home, and then buy it.
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Self is now offering a program where a seller can transfer their assumable loan to a buyer.
"That means that they can get into a home with an interest rate much lower than what they would see if they were to get a new loan today," she said. "Which means they save a lot of money every single month."
So, how much will it cost you? Let me break down the numbers:
For a home listed at $335,000, a qualified buyer makes an offer and goes to contract for the home at $350,000 with a $20,000 down payment and assumes an interest rate of 3 percent.
Self says through their assumable loan program, the monthly payment will be about $1,700.
If you were to buy that home for the asking price of $335,000 with a $20,000 down payment — and with current interest rates around 7.9 percent — Self says the payment would be about $2,300.
The buyer would save about $600 a month — not only benefiting buyers but sellers as well.
"They can actually ask for a higher sales price because of the savings they are able to pass on to their buyer," Self said.
Self says Clark County has about 60,000 active loans that can be assumed with interest rates under 5 percent.
Parker says this program helps make his dreams of becoming a homeowner a reality.
"It's a game-changer if you are looking at 8 percent rates. You're doubled, sometimes tripled, what you would be paying if you got locked in at sub-3 percent."
Self says to qualify, you need a debt-to-income ratio under 43 percent, and you must have a credit score of more than 580.
