At some point in time, everyone hopes to purchase a home for themselves and their families. While many understand the seriousness of this decision, millions of people still make mistakes throughout the process. This leads to financial difficulties and possible loss of the home if things escalate. No one wants to face these issues, which is why developing strong literacy about general financial concepts and mortgages is essential to avoid mishaps. Bruce Boguslav, the Executive Director of HSI Trust Homesavers Ltd, educates, negotiates, and advocates for clients, providing his and the organization’s expertise.
In the last few decades, home ownership has become a far-fetched concept for younger generations. The price of real estate has skyrocketed, along with living costs and interest rates. Many people are struggling to buy a home, or even rent, in this landscape. These extenuating circumstances highlight the increasing need for home buyers to seek out reliable partnerships with companies like HSI Trust which can provide valuable advice.
HSI Trust was founded in 2009 during the American subprime mortgage crisis, which was mainly caused by predatory mortgage lending, unregulated markets, and overwhelming consumer debt. HSI Trust sought to address and assist consumers to understand mortgage agreements and options and to navigate financial difficulty and other factors of real estate and debt.
Many years later, Bruce still sees home buyers experiencing some of the same issues, despite education being more accessible.
“The three biggest misconceptions I see my clients have are simple things you’d think anyone buying a home wouldn’t struggle with. However, no matter their age, educational background, or race, people find finance complicated and often ignore things they need to understand. The first problem I see is that people misunderstand financial products and services from the get-go. They don’t know what they’re being provided with, and that makes them vulnerable to exploitation. Secondly, many people don’t read or comprehend the terms of contracts they sign, and they fail to learn about the legal responsibilities of owning a home. Finally, if they get into crippling debt and other financial difficulties, they wait too long to ask for help.”
According to the US Chamber of Commerce, Americans have a total mortgage debt of $11.39 trillion. This figure includes businesses, financial institutions, and homeowners. As home prices continue to rise in all 50 states, consumers can expect a high monthly mortgage payment. Here’s what Bruce suggests home buyers can do to make informed decisions about buying their home.
Many buyers take a home’s price at face value, not considering any associated costs for purchasing and maintaining a property. Bruce says this is a fatal mistake, as taxes and upkeep are intrinsically part of a home buyer’s responsibilities. To avoid falling victim to unmanageable costs, couples, partners or individual buyers need to be realistic about their budget. They should also consider external factors that can lead to increased costs such as extreme weather events, climate, and neighborhood demographics. Bruce says online mortgage calculators are vital for predicting what kind of down payment potential homeowners can afford. These tools also help them discover their average monthly rate for the area they’re looking to buy in. This helps the selection or elimination of certain homes and neighborhoods because they can quickly see if the properties meet their budget or are too expensive.
For buyers who plan to find tenants to live in the home and pay rent, they will have to complete more extensive calculations. They will need to think about how long it will take to list the house and find and screen tenants. Depending on the amount of time, buyers may need to raise or lower their rent terms to match the market and their costs. Lastly, when formulating a rental contract, the owner needs to ensure that payments are enough to pay for the monthly mortgage and set aside money for future repairs or when the house is vacant. Bruce suggests saving at least 10% of rent for maintenance, repair, and vacancy each month.
One of the most important things Bruce tells his clients is to be knowledgeable about financial contract terms. If they don’t understand what is written in the terms, they should get assistance from someone who does. This is a good way to prevent running into surprises or problems later.
It is often assumed that everyone reads their mortgage contract. However, Bruce has many highly educated and savvy clients who have signed a contract thinking they have a fixed rate, but eventually learn that it’s adjustable or has other clauses that later come as a surprise. Unless they have money to burn, Bruce urges people to think twice before signing without fully understanding the contract. From his experience, poor financial literacy is found in all age and income groups. This may be surprising, but Bruce understands that few people are interested in the nitty-gritty of financial agreements.
HSI Trust works to prevent or address these problems by providing education, negotiation, and advocacy services for clients. The firm can help clients make financial decisions, organize their finances, and resolve mortgage, student loan, and credit card problems. Additionally, HSI Trust provides financial consulting for individuals, families, and commercial clients.
“If your situation requires financial expertise, HSI Trust is the one to trust,” Bruce says. “We help alleviate clients’ problems, and we also guide them to become more educated about their financial needs. HSI Trust wants to be a partner for clients, providing them with the tools they need to succeed.”
Media Contact
Name: Bruce Boguslav
Email: bruce@hsitrust.org
Published by: Pathos Communications Ltd