The homeownership gap is narrowing among Hispanics and Latinos – and military service is one of the main reasons, according to a new report from Veterans United Home Loans.
Census data shows Hispanics and Latinos accounted for 35.9% of household growth between 2010 and 2020. Homeownership rates within the group also increased each year from 2015 to 2020.
“There is a building block for the success and also the benefits of the VA loan program itself,” Veterans United Home Loans Equitable Loans Manager Tracy Pevehouse-Pfeiffer told Yahoo Finance. “But once we actually get into the VA loan program, there will be some big benefits that will come in handy for first-time home buyers.”
A VA loan is available for veterans, service members and their surviving spouses through the Department of Veterans Affairs. It allows qualified borrowers to purchase a home with little or no down payment, prepayment penalties, or private mortgage insurance (PMI). Credit requirements on VA loans are also flexible, so applicants don’t need to have stellar credit scores.
Pevehouse-Pfeiffer says eligibility for VA loans isn’t the only reason Latino and Hispanic veterans are becoming homeowners. Having military experience brings many skills that come with buying and maintaining a home.
“Military service is going to provide training in personal skills, life skills, even some financial education that people are able to do in the civilian sector. When considering buying home loans, they come in with a little bit of knowledge that other people don’t have, but also the skills that allow them to have a paid job, and that’s always great. to become an owner, ”says Pevehouse-Pfeiffer.
The Veterans United Home Loan report also shows that the homeownership rate was 65.3% for both Hispanic and Latino veteran households. There has been a 20 percentage point gap between Hispanic military and civilian buyers since 2015.
According to the Quarterly National MBA Delinquency Survey in the second quarter of 2021, the foreclosure rate among veteran Latino and Hispanic homebuyers was 0.43% compared to 0.51 for their non-veteran counterparts.
Pevehouse-Pfeiffer notes that buying a home is also a way to build generational wealth. “As first-time home buyers who, you know, don’t have another home to sell, or haven’t had time to build $ 5,000, $ 10,000 to buy the home,” said Pevehouse-Pfeiffer. It is a homeownership opportunity that is available as a benefit to those who have earned it to overcome those hurdles and get into a situation where you start building generational wealth and paying for equity instead of just throw money into rent every month. “
Reggie Wade is a writer for Yahoo Finance. Follow him on Twitter at @ReggieWade.
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