Buying a home is a big decision, and there is a lot of information out there that can make it seem even more daunting. Unfortunately, not all of this information is true or applicable to every situation. In this article, we will debunk some of the most common homebuying myths and misconceptions so you can make an informed decision.

Myth #1: You Need an Excellent Credit Score to Buy a Home.

A high credit score can certainly help you secure a lower interest rate, but it is not the only factor that lenders consider when assessing your ability to make monthly payments. Other factors, such as steady employment, other sources of verifiable income, and adequate assets, can also play a significant role in securing a home loan. Lowering your debt obligations can also positively affect your credit score.

Myth #2: You Need 20% Down to Buy a Home.

The idea that you need 20% down to buy a home is a pervasive myth that has been debunked time and time again. While putting down 20% can help you avoid private mortgage insurance, it is not a requirement for securing a mortgage. Many loan types, including FHA, VA, and USDA loans, offer down payments as low as 0-3.5%.

Myth #3: It’s Not a Good Time to Buy.

There is no "perfect" time to buy a home. Market timing is subjective and dependent on individual circumstances. Interest rates may be higher now than they were 18 months ago, but that does not necessarily mean it is not a good time to buy. By considering your unique situation, such as your finances, needs, and goals, you can determine the right time for you to buy.

Myth #4: It’s Better to Rent Than to Buy.

In many housing markets, buying a home can actually be cheaper than renting, particularly in the long run. With rent prices increasing by an average of 8% a year, buying a home can be a smart financial decision. By using a rent vs. buy calculator and consulting with a real estate agent or Loan Advisor, you can determine which option is better for you.

Myth #5: A Pre-Approval Isn’t Necessary.

Getting pre-approved for a mortgage is an essential step in the homebuying process. With a pre-approval, you can determine your budget and stand out to sellers above other offers. A pre-approval can also make the home loan process smoother and faster.

In conclusion, when it comes to buying a home, it is crucial to separate fact from fiction. By debunking these common homebuying myths and misconceptions, you can make an informed decision based on your unique situation. With APM on your side, you can have peace of mind knowing that you have accurate information and a team of professionals to guide you through the process. Contact us today to learn more.