2 Myths Holding Back Home Buyers

Dated: 06/10/2019

Views: 0

Freddie Mac recently released a report entitled, “Perceptions of Down Payment Consumer Research.” Their research revealed that,

“For many prospective homebuyers, saving for a down payment is the largest barrier to achieving the goal of homeownership. Part of the challenge for those planning to purchase a home is their perception of how much they will need to save for the down payment…

…Based on our recent survey of individuals planning to purchase a home in the next three years, nearly a third think they need to put more than 20% down.”

Myth #1: “I Need a 20% Down Payment”

Buyers often overestimate the funds needed to qualify for a home loan. According to the same report:

22% of renters and 31% of homeowners believe lenders require 20% or more of a home’s sale price as a down payment for a typical mortgage today. And,

“If a 20% down payment was required, 70% of those who were planning to buy a home in the next three years said it would delay them from purchasing and nearly 30% indicated they would never be able to afford a home.”  

While many believe at least 20% down is necessary to buy the home of their dreams, they do not realize programs are available which permit as little as 3%. Many renters may actually be able to enter the housing market sooner than they ever imagined!

Myth #2: “I Need a 780 FICO® Score or Higher to Buy”

Many either don’t know or are misinformed concerning the FICO® score necessary to qualify, believing a ‘good’ credit score is 780 or higher.

To debunk this myth, let’s take a look at Ellie Mae’s latest Origination Insight Report, which focuses on recently closed (approved) loans.2 Myths Holding Back Home Buyers | Simplifying The MarketAs indicated in the chart above, 52.4% of approved mortgages had a credit score of 600-749.

Bottom Line

Whether buying your first home or moving up to your dream home, knowing your options will make the mortgage process easier. Your dream home may already be within your reach.

#FloridaHomesForSale#FortLauderdaleHomesForSale#MiamiRealEstate#MiramarHomes#miramarrealtors#pembrokepines#RealEstateFlorida#RealEstateMiami#RealEstateMiramar#realestatePembrokePines

Blog author image

ENRICO & MONICA ROSELLI

Servicing South Florida with Excellence and Integrity for more than 16 years. We cover Broward and Dade Counties. We specialize in Miramar, Pembroke Pines, Weston, SW Ranches, Davie and surrounding ar....

Latest Blog Posts

Time for Your Dream Home, Gen X!

During the housing market crash, Gen X homeowners lost more wealth than other generations. However, things are changing now! A strong economy, increasing home prices, and the recovery of the housing

Read More

Experts Agree: "Home Prices Will Rise This Year!"

Many experts are revising their initial predictions for 2019 to reflect more aggressive projections for home price appreciation. This is great news for homeowners who will gain even more equity in

Read More

3 Things to Know in the Housing Market Today!

A lot is happening in the world, and it’s having a direct impact on the housing market. The reality is this: some of it is positive and some of it may be negative. Some we just don’t

Read More

Renting or Owning, What Is Better for You?

In a real estate market where home prices are rising, many have begun to reexamine the idea of buying a home, choosing instead, to rent for a while. But often, there is a dilemma: should you keep

Read More