Today’s strong demand for housing and limited affordable inventory is triggering home-price growth that threatens the homeownership potential of many would-be buyers. As a result, more buyers are taking on mortgage loans that allow them to put a smaller share of that cost down.
Millennials, in particular, are looking to loans backed by the Federal Housing Administration, which offer smaller down payments and can work with lower credit scores. According to Ellie Mae, FHA loans made up 35% of the total home loan market in January 2017, with millennials taking 84% of new-home mortgage loans closed for the month.
