5 Home Buyer Myths To Ignore
Experts are predicting this year's housing market will be fast-paced and competitive. If you are considering buying a home this year, there could be lingering myths. However, working with a great Realtor will ensure your real estate journey is a success.
Myth 1: The only way to win a home in a hot market is by waiving the home inspection.
Many buyers believe that waiving the home inspection is the only way to make their offer stand out in a competitive market. This is a dangerous myth to believe in, as it can lead to costly surprises down the road. A home inspection can help you identify any issues with the property, and negotiate repairs or a price reduction with the seller. A good Realtor will advise you on how to make your offer competitive without compromising on your due diligence.
Myth 2: Always start with an offer lower than the asking price.
In a hot market, it's common to think that starting with an offer lower than the asking price is a smart move. However, this could backfire and lead to a seller rejecting your offer or even ignoring it altogether. In some cases, multiple offers might be received, and a lowball offer could be pushed aside in favor of a more reasonable one. A good Realtor will help you evaluate the market and make an offer that is fair and reasonable for both parties.
Myth 3: You must have a 20% down payment to buy a home.
While having a 20% down payment can make your mortgage more affordable, it's not a requirement to buy a home. There are plenty of loan programs that offer down payments as low as 3%, which can make it easier for first-time buyers to enter the market. However, it's important to remember that a smaller down payment might result in a higher monthly mortgage payment, and you might need to pay for private mortgage insurance (PMI) until you reach a certain equity threshold.
Myth 4: You need to be debt-free with perfect credit to buy a home.
While having a good credit score and a low debt-to-income ratio can help you secure a mortgage with better terms, it's not a requirement to buy a home. Lenders will evaluate your financial profile and determine if you qualify for a loan based on several factors, including your income, employment history, credit score, and debt-to-income ratio. A good Realtor can recommend lenders who specialize in working with buyers who have less-than-perfect credit or high debt loads.
Myth 5: You will not be able to regain equity quickly with current home values and mortgage rates.
This myth is simply not true. Homeownership can be a great investment, and over time, your home can appreciate in value, allowing you to build equity. While there might be fluctuations in the market, history shows that home values tend to increase over the long term. With today's low mortgage rates, buying a home can be an excellent way to build wealth and secure your financial future.