Homebuyers stressed amid stretched budgets, fraud concerns

The dream of homeownership in 2026 comes with a stark reality — nearly 8 in 10 recent buyers blew past their original budgets, and a majority are losing sleep over the process.

That’s according to ServiceLink’s 2026 ServiceLink State of Homebuying Report, which surveyed 1,554 U.S. residents who purchased a home within the last two years, along with 507 loan officers.

High home prices (53%) and high interest rates (49%) ranked as the top two challenges respondents faced.

The national median single-family home price reached $414,900 in late 2025, while average 30-year fixed mortgage rates hovered at 6.90% in 2024 and 6.66% in 2025.

Seventy-seven percent of homebuyers reported exceeding their original budget. Among them, 10% went over by $80,000 or more — with millennials and Gen X leading that category, the report said.

Baby boomers proved most disciplined, with 53% saying they did not go over budget.

Loan officers are taking notice. Sixty-nine percent called borrowers taking on more mortgage than they can realistically afford their No. 1 concern.

Younger homeowners are feeling the squeeze most acutely. Half of Gen Z respondents and 44% of millennials said they have been at risk of missing at least one mortgage payment over the past two years.

The top three financial compromises buyers made: putting down more than they wanted (29%), taking on a higher interest rate than they wanted (29%) and taking on a larger mortgage than they wanted (28%).

Stress, speed and fraud fears

The most stressful part of the homebuying process? The home price offer and negotiation, cited by 19% of respondents. Understanding paperwork followed at 15% and the closing process at 12%.

“There was pressure to make the right decision quickly, and I was worried about having to overpay,” one millennial male told ServiceLink.

But beyond the usual stressors, fraud has emerged as a legitimate and growing concern.

The report reveals that 1 in 4 consumers are targeted by fraud during a real estate transaction and 1 in 20 become victims. Some respondents explicitly voiced fears about being scammed during their home purchase — a worry loan officers share.

Fifty-two percent of loan officer respondents cited mounting cybersecurity risks and growing cases of mortgage fraud as a professional concern.

Urgency defines modern buyer behavior. More than one in three respondents believe closing should take two weeks or less — a sharp contrast to the industry average of 30 to 40 days.

Forty-three percent of loan officers said their borrowers expect to close within two weeks.

Younger buyers are also getting inventive. Nearly half of Gen Z (47%) and 41% of millennials borrowed from or pooled money with friends and family for a down payment.

Twenty-seven percent of all respondents tapped their 401(k) for down payment funds — including 37% of millennials.

Digital fluency is non-negotiable. Eighty-eight percent of respondents said the opportunity to eSign closing documents would influence their choice of lender.

Virtual closings (82%) and fully digital end-to-end processes (78%) also ranked high.

Yet human connection remains critical. Real estate agents (43%), family and friends (35%), and lenders (29%) were the top sources of educational information — ahead of social media (21%) or AI chatbots (21%).

What borrowers want now

Borrowers are demanding simplicity, affordability, communication and stability.

They want fast approvals, fast processing and fast response times as well as plain-language paperwork and transparent fee explanations. Nearly 40% said they would prefer to close at home or another location of their choosing — with a notary traveling to them.

Sixty-four percent of recent buyers said they are happy with their current mortgage rate, but 79% said they would be likely to refinance in 2026 if conditions improve — with millennials (85%) and Gen Z (84%) most eager.

Loan officers see a knowledge gap. While 67% of buyers said they fully understand taxes, loan officers estimated only 48% of their borrowers truly do. Similar gaps exist for real estate agent fees and appraisal fees.

“Simplify, clarify, communicate, support,” one millennial female respondent summed up.

The full 2026 ServiceLink State of Homebuying Report includes additional data on co-buying trends, pet-driven home features and the growing digital demands of a new generation of homeowners.

This article was written by Jonathan Delozier and generated with the assistance of HousingWire Automation. It was reviewed by a HousingWire editor before publication. The system helps convert company announcements and industry data into HousingWire-style news coverage.