In Realtor.com’s article, “Home Buyers’ Top Mortgage Fears: Which One Scares You?” they mention 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”
Buyers overestimate the down payment funds needed to qualify for a home loan. According to a study released by NerdWallet, 44% of Americans believe they need to put down 20% or more to buy a home.
The article explains that:
"VA loans require no down payment; Fannie Mae and Freddie Mac have 3% down programs; FHA loans allow down payments as low as 3.5%; many banks and online lenders now offer their own low-down-payment mortgages; and several state and local governments offer down payment assistance programs to residents."
Many renters may actually be able to enter the housing market sooner than they ever imagined with new programs that have emerged allowing less cash out of pocket.
Myth #2: “I need a 780 FICO® Score or Higher to Buy”
A survey revealed that 59% of Americans either don’t know (54%) or are misinformed (5%) about what FICO® score is necessary to qualify.
Many Americans believe a ‘good’ credit score is 780
or higher.
To help debunk this myth, let’s take a look at Ellie Mae’s latest Origination Insight Report, which focuses on recently closed (approved) loans.
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. Contact The Beck Team to find out! Call us at 406-360-7654 today!
