Student loan debt is stopping many people from being homeowners. However, that is not the only problem that millennials face. Millennials who are able to buy a home often have to take out a more expensive mortgage.
Only 34 percent of millennials with student loan debt have homes. This is two percent lower than millennials without student loan debt. Millennials who buy a loan with student loan debt have a higher mortgage. The average mortgage debt for a millennial with student loan debt is $104,000. The average mortgage debt for a millennial who does not have any student loan debt is $98,000.
Student loan debt is also keeping millennials from saving money. Millennials with student loan debt have a net worth that is 75 percent less than millennials who are debt-free. They also have less money saved up for retirement.
Rebecca Safier is a financial advisor. She stated that all is not lost for millennials who want to buy a home. She recommends that millennials make extra student loan payments if they can. This will not only help people get out of debt faster but they will also be able to save money on interest.
Rebecca also recommends that people try to increase their income. She stated that people ask their employer for a raise. She also stated that people can pick up a side hustle to bring in extra income.
Additionally, Rebecca stated that some borrowers can benefit by refinancing their loans. If you have a steady source of income and good credit, then this may be a good option. You may be able to get a lower interest rate. You will also be able to choose a new repayment term. That is why you will be able to pay your student loans off in a shorter amount of time.