A Latina Money Expert's Tips For Buying Your First Home

A lack of financial literacy poses a significant barrier for Latines in the United States, often hindering their ability to build equitable wealth. So we asked five Latina money coaches to offer their financial expertise on all the pressing topics you have questions about, from building credit to homeownership. This Women's History Month, we want Latinas to understand that regardless of their financial journey so far, they have the power to improve their financial well-being for generations to come.

The Latine community is a growing economic powerhouse in the US, reaching historic spending highs consistently over the past decade. Still, systemic racism complicates wealth-building. Younger Latines are now focusing on financial literacy to help bridge the wealth gap between them and their white peers. They are educating themselves on everything from the stock market and real estate to credit institutions, with the help of social media and influencer finance coaches. Among their many questions, these young adults wonder: how can I buy my first home?

The answer isn't as complicated as it may seem if you know where to look. This is where financial literacy becomes important.

Latines are great at contributing to the economy, but wealth-building lags, due to community-wide financial illiteracy and systemic racism. A 2022 Latino Donor Collaborative study noted a 65 percent growth in the US Latine GDP from 2010 to 2020: a total economic output worth $2.8 trillion in 2020. Despite this output, the St. Louis Federal Reserve found that in 2019, the median wealth of Latine families equated to $38,000 — a mere 21 cents of every dollar earned by white families. A Morningstar report also found two-thirds of Latine households weren't saving anything through employer-sponsored plans such as 401(k), and only eight percent reported even having an individual retirement account.

Homeownership has been similarly difficult for Latines. A 2023 Urban Institute report noted that aspiring Latine homeowners faced higher mortgage denial rates than white applicants, typically due to their debt-to-income ratios or credit scores, which the think tank notes are not historically race-neutral. Moreover, the report found Latine households had a higher likelihood of being unbanked, making a mortgage difficult to acquire. Latines also face uniquely high housing prices, due to being disproportionately concentrated in expensive real estate markets like New York and California.

For young Latines, financial literacy to demystify stocks, credit, and real estate often comes in the most logical form for a tech-savvy generation: social media and influencers. That's where folks like Natalie Torres-Haddad (@finsavvylatina on Instagram) step in. Torres-Haddad is a financial literacy expert, award-winning author, and TEDx speaker, and the host of the bilingual podcast "Financially Savvy in 20 Minutes," where she discusses money, mental health, and finding purpose. A first-generation college graduate, Torres-Haddad helps other Latines meet their financial goals through social media outreach and financial mentorship.

Read on for her best tips to navigate the real estate market and for the answers to all the questions you might have about homeownership.

How to Get a Loan For a Home

According to Torres-Haddad, predatory lending is common with banks located in Latine communities. Predatory lending refers to unfair terms on a loan, such as high interest rates or removal of the borrower's equity. Clients will usually accept the first estimate on a loan, without following up for more competitive offers or trying to improve their credit scores for a better rate in the long run. Many Latines will accept an initial approval, which Torres-Haddad credits to language barriers, lack of real estate knowledge, and referrals from friends or loved ones. She advises prospective homeowners to educate themselves on loan programs, down-payment assistance, rate buy-downs, and more.

"Most lenders won't tell you about it unless you ask," she explains. "They should also absolutely let their lender know that they intend on getting other estimates. This will keep them all competitive and may result in a better rate or lower fees."

How to Buy a Home During a Recession

For Torres-Haddad, investing in real estate during a recession can have positive outcomes: more deals and less competition. Paying in cash helps, too. She once bid on a rental property in cash, offering much less than other buyers and getting rejected four times in the process. However, because the competing offers needed financing — which takes longer to approve — she was able to close the sale faster and ultimately got the property due to the quick closing and upfront cash payment.

"I've purchased short sales, foreclosures, and discounted real estate based on research and the right team," she says. "It's important to work with a broker who actually invests in real estate as well so they know what to look out for."

How to Prepare For Buying a House

Among her must-know pointers, Torres-Haddad emphasizes the importance of having a good credit score and some cash on hand for the down payment. She also stresses having an expert team to work with to help navigate the brokerage and lending process.

"Start planning and preparing all your financial documents needed to get loan approval," she says. "And don't quit based on what people see as limitations."

How to Buy a Home as a Single Woman

Though some may see being a single woman as a disadvantage in homeownership, Torres-Haddad has previously used it to direct financing negotiations in her favor. At the bidding stage, she would be asked to qualify an offer with questions like, "What does your husband or partner think?" — despite being single at the time.

"I would respond, 'Let me ask him first,' and then would come back a lower offer because 'he' wasn't happy [with] what was offered," she says.

What Should I Know Before Buying a Home?

Don't limit yourself to one specific market, and don't procrastinate. Torres-Haddad recommends not being afraid of buying property out of your area; Los Angeles is one of the most expensive real estate markets, so she first began investing in property out of state before purchasing closer to home. She also recommends getting the jump on a sale early: "Buy before the 'for sale' sign goes up on the lawn," she says. "Because by then you're most likely paying retail price." While Torres-Haddad says it's never too late to invest in real estate, she does highlight the importance of buying when the numbers make sense for you, rather than buying property because it's popular at a certain moment.

While data indicates younger Latines are leading the economic strides of their communities, Torres-Haddad stresses the importance of making financial literacy accessible to all.

"I think all generations need to help educate each other," she says, citing how student loan debt, real estate inflation, and the rising cost of living have made wealth-building difficult for all age groups. Still, she remains optimistic: "I'm hopeful and excited [for] what the future holds as more and more of us begin to help our communities succeed and thrive."

Melissa Santoyo is a Northwestern University graduate, a POPSUGAR contributor, and currently works as an Editorial Assistant for National Geographic Kids.