4 HOME-BUYING MYTHS DEBUNKED
Many people who rent a house or apartment do so because they believe they don’t have the financial ability to purchase a home, but numerous studies have found that home ownership is more cost-effective than renting. So where is the disconnect between perception and reality, and what is preventing some renters from making the leap into home ownership? A look at a few common home-buying myths might provide some answers:
Myth 1
Houses have become too expensive.
Home builders in the Chattanooga area take steps to keep housing affordable while maintaining the highest quality in materials and technique. Such quality translates to easier, less costly maintenance and higher resale values. Additionally, buyers are enjoying historically low mortgage rates, which offsets the increase in home prices.
Myth 2
I can’t afford the down payment.
Most people think they need a 20 percent down payment to buy a home, but that is just not the case. The required down payment is subject to myriad factors and can be quite low, depending on the lender and other circumstances. Shop around for the mortgage that best fits your unique situation and don’t be afraid to ask for a lower down payment.
Myth 3
I have too much debt for my income level.
It’s true that a high income-to-debt ratio can affect your viability for a loan; however, it is within your control to lower your debt by paying it down over time. Spend some time aggressively attacking the debt with larger monthly payments and avoid increasing your debt as much as possible.
Myth 4
My credit history is not good enough for a loan.
Even though a credit score of 660 is considered the lowest acceptable score to secure a prime rate loan, there are plenty of lenders that will offer loans to
buyers with lower scores. Of course, the higher your credit score, the better your mortgage rate, and the lower your monthly payments. But, don’t assume you’re completely out of the running until you ask.
Buying a home doesn’t have to be a scary undertaking, and you’ll never know if you’re ready until you begin exploring your options. Consult with a lending professional who can help you determine your readiness for home ownership.