Renters sometimes stay in a home for a decade or more, and the may not try to save up for a home in all that time because home ownership can seem out of reach for many long-time tenants. However, some of the most common lies about home ownership can lead renters in the wrong direction. Be sure to separate fact from fiction when deciding whether you want to buy a house.
Lie #1: You Need to Have a Big Savings for the Down Payment
You will need to have a down payment for your home in most situations, but you don't always have to have thousands upon thousands of dollars in your savings to qualify for a mortgage. Also, you may qualify for an FHA loan or even a program that offers down payment assistance. The standard for conventional loans is a 20 percent down payment. In other words, you need to have 20 percent of the cost of the house as your down payment for many traditional loans.
Lie #2: It's Always a Bad Idea to Buy a Home for a Short Period of Time
It's a very widespread lie that you should only buy a house if you intend to stay in an area for at least five years. While that is a good rule of thumb for many people who may be staying in a location temporarily, many people have ties to a location long after leaving. It may make financial sense to buy a home even if you are only there for a year.
Lie #3: You Must Have Picture-Perfect Credit to Get a Mortgage
Sometimes people don't even try to get financing for a house because they have bad credit. Renters often worry that their bad credit will prevent them from getting a mortgage in the same way that it prevents them from getting approved to be tenants at certain locations. However, the truth is that even people with bad credit can often get a mortgage.
Lie #4: You Need to Find a Home Before Pursuing Financing Options
Renters may hesitate to pursue financing options for a house until they have found a home they want to purchase. That can be a big mistake because you should actually start with knowing what kind of loan can attain before you look at homes. That way, you know your price range and have a realistic idea of the budget you may have for your future home.
Finally, keep in mind that you should avoid falling for these common home buying lies that renters often believe. If you want to buy a home, talk to your real estate attorney about any doubts or questions you may have. Don't let rumors and lies stand in your way of owning the home you always wanted and investing in property to benefit your financial future.
Contact a business like Berkshire Hathaway HomeServices Lynch Realty for more information.