Getting to the Truth Behind 2 Real Estate Myths

I’m going to debunk two common myths about real estate that could be keeping you from owning the home of your dreams.

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Today, I’m going to debunk two very big myths that may be holding you back from enjoying the benefits of homeownership

1. You need 20% down for a down payment. Buyers often overestimate the down payment funds needed to qualify for a home loan. According to reports done by Urban Institute, consumers are often unaware of the option to take out low down payment mortgages. Only 19% of consumers believe that lenders would make loans with a down payment of 5% or less, while 15% believed lenders require a 20% down payment, and 30% believed lenders expect a 20% down payment.

These numbers do not differ much between non-owners and homeowners. 30% of non-owners believe they need more than 20% down for a down payment, while many believe that they need at least 20% down to buy their dream home. They don’t realize that an FHA loan, which 25% of purchasers use, requires as little as 3.5% down.

Did you know that federal guidelines will allow friends and family to gift down payment money to you? If you’re a veteran, you may qualify for a VA loan, which is a zero down payment loan program. Other programs are also locally available, such as offer programs and the Rural Development Program, which will also allow you to buy without money down.

Yes, you may actually be able to enter the housing market much sooner than you ever thought possible, so don’t let the myth that you need lots of money down keep you from buying a home.

2. You need a 780 FICO score or higher to buy a home. According to Ellie Mae, a company that processed nearly a quarter of all mortgage applications last year, more than half of all approved mortgages had a credit score of 600 to 749.

From all of this, we learned that you shouldn’t believe all the myths on the streets. They could be keeping you from moving into a home that’s all your own. Sit down with one of the real estate experts on my team for the facts.

Feel free to give us a call or send an email, and we’ll get you in the process of starting to buy your own home. And, as always, if you have any other questions or would like more information, we would be happy to hear from you.