2 Myths Holding Back Home Buyers

Dated: 06/10/2019

Views: 1

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

Be on the Lookout for Gen Z: The Next Generation of Homebuyers

Gen Zers are the next generation of homeowners, and they’re eager to jump in and buy their first homes. Whether you are part of this generation or any other, it’s never too early to

Read More

Existing-Home Sales Report Indicates Now Is a Great Time to Sell

Based on the current state of the market, trends are shifting in favor of sellers. If you are going to sell, now may be the time to take advantage of the number of buyers who are searching for their

Read More

You Need More Than a Guide. You Need a Sherpa.

In today’s world, hiring an agent who has a finger on the pulse of the market will make your buying or selling experience an educated one.In a normal housing market, whether you’re

Read More

Homeownership is the Top Contributor to Your Net Worth

Recently two U.S. Census Bureau researchers released their findings on the biggest determinants of household wealth. What they found may help shape your view on building your family&rsquo

Read More