Are you holding off on buying a home? If so, why? Many people fall for 2 myths that mislead them into thinking they can't buy a home. In Realtor.com’s recent article, “Home Buyers’ Top Mortgage Fears: Which One Scares You?” they bring out that “46% of potential home buyers fear they won’t qualify for a mortgage to the point that they don’t even try.”
Myth #1: “I Need a 20% Down Payment”
Many buyers overestimate the down payment amount they'll need to qualify for a home loan. According to the First Quarter 2017 Homeownership Program Index (HPI) from Down Payment Resource, saving for a down payment was the barrier that kept 70% of renters from buying. Rob Chrane, CEO of Down Payment Resource had this to say,
“There are many mortgage-ready renters today, but they don’t know it. Often, homebuyers remain sidelined for years due to the down payment.”
Many people don't realize that they need as little as 3% down with certain programs. This means many renters can enter the housing market sooner thatn they may have ever though.
Myth #2: “I Need a 780 FICO® Score or Higher to Buy”
According to Ellie Mae’s latest Origination Insight Report, which focuses on recently closed (approved) loans, many were approved with a score of only 600! Check out the chart below.
