A new study contends that recent college graduates carrying the average amount of student loan debt can afford to buy a home in a majority of markets, including Palm Beach County.
RealtyTrac calculated the average student loan to be $22,873 in Florida and concluded that a minimum salary of $31,159 could buy a median-priced home. They labeled an “affordable home” as one with payments that do not exceed 43 percent of a month’s salary. The research firm used a 30-year mortgage with a 4.13 percent fixed interest rate and a 20 percent down payment for its study, according to Palm Beach Post.
That 20 percent down payment raised skepticism from Skip McDonough, president of Jupiter-based Family Mortgage. McDonough believes most recent graduates can’t afford that down payment unless they receive help.
“Not everyone has mommy and daddy willing to throw down that much money,” he said.
Other factors such as credit ratings, credit card debt and big ticket impulse buys can also derail this line of reason, according to McDonough. [Palm Beach Post] – Frank Maradiaga