Buying a home can be an intimidating process. When you start thinking about the possibility to own a home, you learn that there is a lot of competing information out there. Here are 3 commons myths debunked on the home buying process.
1. “You need excellent credit to buy a home”
You don’t need perfect credit to qualify for a mortgage. When a lender is considering you for a home loan, they are looking for your ability to repay your mortgage, without the risk of defaulting on the loan. Yes, a Higher credit score means interest rates will likely be lower. However, having a low credit sore doesn’t disqualify you from a mortgage. You can a minimum of 580 credit score to qualify.
2. “You need 20% down to buy a home”
Not every loan requires you to put 20% down. There are different loan types, each with their own requirements for down payment. Some loans, such as FHA, are ideal for first-time homebuyers because your down payment can be as low as 3.5%. VA and USDA loans are available with 100% financing for qualifying borrowers.
3. “It’s not a good time to buy”
Mortgage rates are still at a historic low giving potential homeowners a great opportunity to buy a home and save money. Lower rates means lower monthly payments and more money saved as a result. Meanwhile, rent prices are continuing to climb, making buying cheaper than renting in most parts of the country.