When it comes to considering being a homeowner, you have probably reached out to multiple companies, friends, and family members about their experiences and any advice they can give. After all, the home buying process can be long and confusing, and any help that you get is much appreciated. But sometimes, when you seek help from others, you hear about some of the negative experiences too. While these aren’t all terrine perse, it may be discouraging. Here at Ace Mortgage Loan Corp. in Coral Springs, Florida, we want to help you with your home buying process by giving you all of the facts. No matter how much you think you know or you think what you’ve heard is true, it never hurts to get a professional perspective. Keep reading to learn about a few of the most common home financing and home buying myths we know of!
- You Need a Perfect Credit Score
The first myth we want to bust is the need for a perfect credit score. Of course, the higher the credit score, the more likely you are to look like a reliable borrower to the lender. However, lenders understand that you may have had rough patches in the past that do not always reflect who you are in the present. Many lenders will work with you if your score is at least a 620, with some even accepting a 580. Another factor that involves credit is the problem of having student loan debt. People with this debt tend to think they cannot become a homeowner until its paid off, but that isn’t true. As long as you are making payments on time and have made some progress towards no debt, you’ll be able to become a homeowner. With that in mind, a lower credit score and student debt should not discourage you from becoming a homeowner.
- Down Payments are 20% of the Cost of the House
The myth about a down payment being 20% of the cost of the home is a myth that goes back many decades. Your unique situation will change the down payment percentage, but many people find they pay as little as 5%. Some people pay between 3-5% while others might pay a scant 3.5% down and pay more as time passes. The best way to determine how much you have to pay is to work with someone from the Ace Mortgage team. Having a professional evaluate your situation will give you more clarity.
- Always Buy a Home at the Max Amount You Qualify For
Last but certainly not least, the myth that you should buy a home for the maximum amount you qualify for. This myth is extremely damaging and can put a lot of people in rough financial situations. The lender will give you an estimate of how much you can borrow early on based on a number of factors. But just because the lender approves you for say $500,000 doesn’t mean you have to go with a home that is worth that much. Go big or go home doesn’t apply when it comes to being a homeowner. The main reason why is because being a homeowner comes with a lot more financial responsibility than most think. For instance, you may have to pay monthly fees for things such as pest control, garbage pickup, lawn care, pool service, HOA, and more. It’s always better to work within a reasonable budget despite what you are offered.
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If you are considering becoming a homeowner, you should go for it! Owning a home is very rewarding and comes with many benefits that renting cannot give you. If what was holding you back was one of the myths mentioned, remember that they are just myths and will not stand in the way of you owning your dream home. For more information on becoming a homeowner, reach out to our team at Ace Mortgage Loan Corp.