Terrell Johnson’s lack of a credit card helped him not incur debt, but it could have been a barrier to home buying.
He didn’t have a credit score, which lenders use when determining a homeowner’s credit risk and interest rate. Johnson decided about a year before buying a home to get a secured credit card, which uses cash collateral as a deposit that becomes the account’s credit line. He put a few purchases on it and paid it off every month, to establish a credit history.
Working with Dorianne Newkirk of Keller Williams Realty Atlanta Partners-Snellville, he bought an end-unit townhome in Lithonia. Johnson, a paraprofessional at a high school, chatted about the purchase.
Q: How did you save for a home?
A: From the point I started working when I was 18, I always put back around $50 a month. I'm 31 now. That ended up being a good lump sum money that I never touched.
Q: Besides a credit score, what else did you have to provide to get a loan?
A: They used my cell phone records, my insurance on my car, my life insurance plan that I had on myself. They used, of course, my bank statement. They used my savings investments. I had solid work experience. That all paid off for me.
Q: What were you looking for?
A: A three-bedroom, two-bath. I wanted a townhouse. I wanted the bachelor pad-type place. Then I wanted something that was nice. In case I got married, I could stay at the house for five to six years and eventually sell it.
Q: Why did you buy this townhome?
A: The (seller) fixed the house up pretty well. I could see where they painted everything, they cleaned the carpets. It looked like a brand new house. I saw it when we first started looking at houses but it was more than I wanted to pay for it. When two or three months passed by, they dropped by the price by about $13,000. Patience paid off.
Q: What does it feel like to be a homeowner now?
A: It feels good because I can come home and say, "This is mine." It's a sense of accomplishment, just to see that I've gotten one of my life goals done.
Q: What’s your tip for first-time buyers?
A: Be patient. I felt like, I'm the buyer, I'm going to buy something that I want.
At a Glance
Terrell Johnson’s home, built in 2005, has three bedrooms, two-and-a-half baths and 2,049 square feet. He purchased it in November 2014. Homes in Lithonia’s Redan Square, in DeKalb County, are priced in the low $100,000s.
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