Jeff Duncan Real Estate
Jeff Duncan
(360) 441-2121(360) 441-2121

2 Myths Holding Back Home Buyers

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 the chart below from Ellie Mae, which focuses on recently closed (approved) loans.

As 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.

 

Content courtesy of Keeping Current Matters, 2019

Leave a Reply

Community Events

Day trip to Camano Island, Washington.

Fun Getaways

A short drive about 2 hours to Washington, USA, Camano Island.You must have a valid travel document. I will be driving from Abbotsford directly to Bellingham and we all meet at a Starbucks near Lowe's in Bellingham 8:30 am. 1185 E Sunset Dr....

Lake Padden Rollercoaster Hike

Bellingham Trails Meetup

Distance: 6.3 Miles roundtrip.Elevation Gain: 1030 feet.Pace: 3-3.5 MPH.Terrain: Gravel, dirt trails, some steep hills. Let's meet at the WEST entrance. I'll be parked near the restrooms and will wait near the bench by the restrooms. This is a...

Crystal Bowl Monday Meditation

Center for Mindful Use

Whether you are new to meditation or a veteran "sitter," please join us every Monday evening in Bellingham's Forum de Freedom as the CMU community gathers to practice mental stillness. Meditation unites mind, body and spirt, helping one tap into...

Our Coverage Areas