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Mortgage Myths for Home Buyers

Blog | Mortgage Myths for Home Buyers

Mortgage Myths for Home Buyers

  • Posted by Blake Mortage
  • /
  • October 4, 2019
First-Time Homebuyer

Entering the housing market as a newbie can be intimidating. Even more so when you hear rumors about how “difficult” or “expensive” it is. But don’t believe it! As the experts in first-time home loans, we have all the answers and resources to make your home purchase happen with ease. 

Find out the truth about buying your first home, and for personalized answers, contact us! 

Myth #1:

You need a 20% downpayment

While a 20% down payment means you won’t pay private mortgage insurance (PMI), you can buy a home with much less down. In fact, there are loan programs that require as little as 3% down. Are you a veteran, currently enlisted, or a spouse of a member of the armed forces? Then you may qualify for zero down! 

20% down has its perks, such as no PMI and building equity a lot sooner. But that doesn’t mean you MUST have 20% now to buy a home. When it comes to how much you can afford to pay every month, an FHA loan with 3% may be the most affordable option.

Mortgage Myth #2:

You won’t qualify for a home loan if you have student loans

Got student debt! So do most borrowers! Student debt and credit card debt are different “in the eyes of lenders.” So even if you have substantial student debt, buying your first home is still very much possible. 

Mortgage Myth #3:

Avoid adjustable-rate mortgages like the plague

The 2008 housing crisis is still fresh on many buyers’ minds, and this may make you wary of adjustable-rate mortgages (ARMs). But you shouldn’t be! The bust was more of an issue of too-lax qualifying standards and less about the loan program itself. 

ARM loans are an attractive option because of the low fixed interest rate it offers for the first few years. An ARM is a great option if you plan on refinancing or selling within 10 years. In fact, it could potentially save you thousands.

Mortgage Myth #4:

You won’t qualify for any government home loan program 

Government-sponsored loans from Fannie Mae and Freddie Mac offer numerous affordable lending options. Eligibility is much easier than other loan programs and could be based on the location of the home, your income, your military status, and even your first-time homebuyer status! 

Curious as to which government loan you qualify for? Contact us today to get started!

Mortgage Myth #5:

Your pre-approval can be used on ANY home

The property itself may impact how much you’ll ultimately be able to borrow, especially when it comes to the final cost. So even if you were approved for a specific amount, your pre-approval might not work in that particular property. This is most often the case when it comes to properties like condos and townhomes that may have higher final costs due to property tax rates and homeowners association fees. 

Mortgage Myth #6:

You don’t need a real estate agent

Searching home listings via the internet is easy, but presenting you with a list of homes for sale isn’t the only thing a real estate agent does! They work as your advocate. They know the housing market well, know all the right questions to ask, negotiate on your behalf, and make sure that you are absolutely satisfied with your new home purchase. 

Whether you’re a first-time buyer or an experienced “flipper,” real estate agents offer an invaluable service in the homebuying journey. 

So what’s the truth about purchasing a home as a first-time buyer? It’s easier than you think! Contact us today to get matched with a home loan program that fits your budget and lifestyle. For the fastest response, use our contact form located on our site or give us a call. We look forward to serving your mortgage needs.

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