There’s no shortage of ‘advice’ on what you need to buy a home. Unfortunately, some of the information commonly shared can cause more harm than good. We’re here to help you debunk five of the top myths about buying a home to help you navigate the homebuying process.
1. Myth: Newer and bigger = better and easier
It can be tempting to look for homes that seem more picturesque or “turnkey”, but the most important part of living in a home is enjoying your new space. While luxury home features and sprawling floorplans are inviting, make sure you factor in the following:
- How much space you need vs. how much space you want
- How much time and money are needed to furnish, clean, and maintain a larger home
- If the home has the ‘creature comforts’ you and your household need (e.g., a first floor bedroom and bathroom)
- If it’s worth the extra costs for a few additional upgrades
- If the more modern home is farther from work, school, and leisure activities or loved ones
Determine what you need in a home and what features can help you live the life that best serves your goals.
2. Myth: You cannot buy a home without a 20% down payment
Though this is a good rule of thumb, there are several municipal, state, and federal programs available to help house hunters acquire a home with a smaller down payment. The HUD (U.S. Department of Housing and Urban Development) has a wealth of information on special programs and legal considerations for homeownership, especially if you’ve never bought a home before.
Pro Tip: When they process your application, ask if there are any in-house or local homebuyer assistance programs. These initiatives help bring homes you can already afford within financial reach, often with no down payment required. You could be leaving thousands of dollars on the table without this!
3. Myth: The offer the seller accepts is the price you pay
Hearing that the seller has accepted your offer is a big moment, but it doesn’t mean you’re out of the woods yet. It means you’ve entered the limbo period, during which several events can occur. Once you have the keys to your new home in hand, you’ll know it’s officially yours, and you can finally have a happy closing day!
4. Myth: Loan applications are processed the same from lender to lender
Though your information is unlikely to change, submitting your home loan application form to different lenders can yield different results. Applying for a mortgage with three separate institutions can give you a solid sample of your options in the local market. Approval criteria can vary from lender to lender and submitting a loan application with certain mortgage lenders may come with fees or a commission for the mortgage loan officer. Ask about both before turning in any paperwork.
5. Myth: “For Sale By Owner” (FSBO) homes are easier to own
Many house hunters have been told that buying straight from the owner is a less involved route to homeownership, but any home you purchase is a critical investment that deserves to be handled with the utmost care. Hiring a real estate agent is critical to effectively navigating the complicated homebuying process, and working with a real estate agent on both sides of the exchange can help you house hunt even more successfully.
Now that we’ve dispelled these major home buying myths, check out our guide on how to become a homeowner to avoid bumps on the road to owning your home.