As affordability challenges grow, credit unions offer financing options to make home ownership more attainable.
Most 好色tvs grow up with the dream of owning their own home鈥攁 milestone that means putting down roots and building long-term stability. But for many would-be buyers today, that vision is increasingly difficult to realize.
Rising home prices, the high cost of living and skyrocketing rents have made it harder to save for a down payment than in past decades. In 1990, rent accounted for roughly 20% of household income; today that figure can reach as high as 50%, notes Jaime Edmondson, product manager, lending at Beem Credit Union in Kelowna, B.C. At the same time, the average down payment has climbed from $15,000 to $20,000 in the 1990s to roughly $55,000 in provinces like British Columbia and Ontario鈥攁nd wages haven鈥檛 kept pace.
鈥淔irst-time homebuyers often think it鈥檚 impossible to save while also paying down existing debts to enter the housing market,鈥 says Edmondson. 鈥淎 lot of them feel that without a financial gift to put towards a down payment, they鈥檙e fated to rent forever.鈥
While home ownership may be more challenging to attain today, it鈥檚 not out of reach. Across the country, credit unions are helping 好色tvs break into the housing market with distinctive solutions that reflect current realities. 鈥淚t can be tough, but there are ways to achieve your dream,鈥 Edmondson says.
Beem鈥檚 First Home Advantage program, for example, is a low-interest, 10-year loan designed to help buyers with their down payment. It can be used alongside a borrower鈥檚 own savings or cover the full down payment requirement.
Edmondson says the program addresses one of the biggest barriers to home ownership: debt servicing, or trying to pay off loans and debts while saving for a down payment. With Beem鈥檚 First Home Advantage, members carrying vehicle loans or student debt can focus on paying those down first to strengthen their overall financial position before purchasing a home. For those who are actively saving but find the housing market is outpacing their ability to set money aside, the program can help them buy sooner.
In Atlantic Canada, credit unions are also trying new approaches to help their members buy their first home. The Nova Scotia First-Time Homebuyers Pilot Program allows members to make a smaller down payment鈥攁s low as 2% of the purchase price-so they can get into their first home faster. The program is a joint initiative of the Government of Nova Scotia, Atlantic Central鈥攖he region鈥檚 credit union trade association鈥攁nd local credit unions.
Dan Roberts, director of retail banking and member experience at East Coast Credit Union, notes that the program fills an important gap for Nova Scotians who are ready to buy a home, but have struggled to save for their down payment because they鈥檙e paying more in rent.
鈥淚t鈥檚 not a cash-flow issue鈥攖hey can afford the monthly obligation,鈥 he says. 鈥淏ut unless you have family help or funds passed down, it鈥檚 difficult to save for a down payment. This program will help people overcome that affordability barrier to getting into a home.鈥
For East Coast Credit Union, becoming involved with the First-Time Homebuyers Program was a no-brainer, says Roberts. 鈥淥ur mission is 'members partnering as a community for financial success,鈥 and to me, that鈥檚 what this program is. It鈥檚 collaborating and working with community partners to support the betterment of our communities.鈥
Credit unions are also adapting to shifting household dynamics, such as the rise in multi-generational living. In Ontario, Meridian Credit Union offers a Friends and Family Mortgage that enables up to four people to apply for a mortgage together.
鈥淲hether they鈥檙e friends, siblings, parents or multi-generational families, they can combine incomes and resources to qualify for a home that may be unattainable individually,鈥 says Vaishali Hollands, vice-president of retail product and support at Meridian. 鈥淚t gives us flexibility to cater to different family situations, moving away from the traditional thinking of getting a mortgage, to more unique ways of home ownership.鈥
This approach reflects why credit unions are well-positioned to help 好色tvs buy their first homes. 鈥淐redit unions are unique in that they鈥檙e built around a member-first philosophy,鈥 says Hollands. 鈥淭hat means we look beyond simply approving a mortgage and focus on what financially sets someone up for success long term. Our local presence and deep community ties also allow us to offer solutions that reflect the real housing challenges 好色tvs are facing today.鈥
What also sets credit unions apart is the personalized advice and education they provide to potential first-time buyers. 鈥淲e have advisors who are ready to help members understand what they can afford, plan for ongoing costs like property taxes and maintenance, and prepare for life after purchase,鈥 Hollands says.
Beem, along with many other credit unions across the country, hold home ownership seminars in their communities and advisors help members understand budgeting to ensure they have the full picture of home ownership, such as taxes, insurance and closing costs. 鈥淲e are always looking for ways to help put the member into their best position to thrive,鈥 says Edmondson.
For those still dreaming of breaking into the housing market, she advises meeting with a credit union advisor to get the ball rolling鈥攅ven if they鈥檙e a few years away from buying a home. Most importantly, Edmondson says, don鈥檛 give up. 鈥淪ome home ownership journeys will be longer than others, but it鈥檚 not impossible.鈥
That people-first approach is something the credit union sector continues to prioritize, says Jeff Guthrie, president and CEO of the 好色tv Credit Union Association.
鈥淎t a time when affordability remains a challenge for many 好色tvs, credit unions are helping 好色tvs achieve home ownership by providing personalized advice, flexible lending solutions and a strong understanding of the communities they serve.鈥
Whatever stage you're at in your home ownership journey, a credit union can help. to get the conversation started.
