Buying a home is one of the most stressful decisions you’re ever going to make. Whether it’s your first time or you’ve had plenty of experience, buying a home can be a complex, challenging process with lots to figure out. To make the process even trickier, there are a plethora of myths regarding home buying and if you’re looking to buy a home, chances are you have already come across some of them. Read on to learn more common misconceptions about buying a home.
If you are interested in purchasing a home and you’d like more information, contact the Central Indiana real estate agents at CENTURY 21 Scheetz today.
Buying a Home is a Waste of Money
One common myth about buying a home is that it is simply a waste of money. In an ever-evolving world, this may not be as simple as a yes-or-no question because purchasing a home is certainly not for everyone. There are lots of factors to consider when deciding if buying a home is right for you – however, buying a home is typically less costly than renting and it is a great way to begin building equity. You also get the added bonus of knowing that every cent you pay is going towards something that you own and not your landlord.
You Can’t Buy a House Without Perfect Credit
One of the first things potential buyers hear from those around them is that they need to have a spotless credit history in order to get a mortgage. Not only is this false, but lenders actually look at much more than just your credit score; your income, assets, and debt are all other factors that lenders consider when determining if you qualify. Having better credit will definitely help you score a better interest rate but it is certainly not a requirement. When in doubt, consult your real estate agent or financial advisor to see what works best for you.
You Need to Get a 30-Year Fixed Mortgage
This traditional mortgage is popular and for good reason: with a 30-year mortgage at a fixed interest rate, you can expect to pay the same amount every month for the entirety of the loan. However, mortgages aren’t always one-size-fits-all. There are actually 5 distinct mortgage types and each comes with their own benefits and drawbacks so be sure to shop around and figure out what is ideal for you.
Don’t Buy in a Sellers Market
One of the biggest myths about buying a home is that you have to wait for the market to be in the buyer’s favor. If you’ve been looking into buying a home, you’re probably aware of the current housing market and the high prices and low inventory. Hearing this alone is enough to scare any potential buyers into panic mode but the truth is that you should buy when it makes sense for you. You may face certain obstacles depending on when you choose to buy but you may also reap the benefits.
You Need to Save Enough For a 20% Down Payment
While saving up to make a down payment on your home, you may have heard the myth that you need to put 20% down in order to secure a loan. Similar to the perfect credit score myth, 20% is absolutely false and not necessary. It is important to save up as much as you can (remember: the more you put down, the lower your monthly payment will be), but the average down payment is actually 12% – not 20.
You’ll Only Pay What The Home is Listed For
Of course, buying a home isn’t as simple as paying what it’s listed for. Aside from what you plan to save for the down payment, be sure to add the costs of closing, homeowners insurance, taxes, repairs, and any other applicable fees (HOA dues) to your budget. There are plenty of intricate details to the complex process that is home buying so the better you prepare, the easier it will be.
Once Your Offer is Accepted, The Home is Yours
Don’t break out the champagne yet, there is still a bit more to the process once an offer is accepted. While the seller accepting the offer is a great step, there is still financing, appraisals, inspections, and other actions to take before you can consider the home yours, all of which could have an impact on the sale. Be patient and trust the process!
These are just some of the biggest home buying myths. If you’re looking to purchase a home, be sure to steer clear of these common misconceptions! To learn more about the process of buying a home, contact the Central Indiana real estate agents at CENTURY 21 Scheetz today.