Home buying myths busted
Whether you've never owned a home or you're an experienced homebuyer, don't let these common home buying myths deter you from finding the right home for you.
Whether you are a first-time homebuyer, or an experienced homeowner — home buying often comes with mixed messages, confusing concepts, and stress.
We'll help you sort through some of the most common home buying myths to put your mind at ease.
Home buying myths
Myth #1: You have to front a 20% down payment
Affordability is often a major concern for prospective homebuyers, and this includes gauging how much money to have saved for a down payment on a home. While a 20% down payment could provide some benefits like avoiding Private Mortgage Insurance (PMI) or lowering your monthly mortgage payment, it isn't the only option. Other down payment amounts like 5%, 10% or 15% may provide you more flexibility as you determine what price of home to aim for, and can be a less daunting amount of money to have saved prior to closing on your home. Leverage this calculator to help determine what amount for a down payment feels best to you.
Myth #2: There's a perfect time to buy a house
The housing market is difficult to predict and depends on many factors like current interest rates, location, demand and even tax reform. The best consideration for home buying timing is your own, based on your financial preparedness. If your down payment is saved and you are prepared for other costs like closing costs, inspections and necessary renovations - your timing may be just right, regardless of the market. Ideally, you've also prepared a monthly budget for your upcoming cost of home ownership to validate that you are buying a home at a time that works best for you.
Myth #3: Renting is always more affordable than buying
This is not always the case, though it is highly dependent on where you live. This calculator can help discern the long-term savings or cost of renting, as compared to buying, based on your location. That said, it is important to consider the value you place on the intangible benefits of home ownership. Some of those factors include stability, pride of ownership and home equity that you can eventually borrow against or leverage for future investments.
At the end of the day, the home buying process is dependent on your individual situation. Invest time in the process by doing your research and speaking with trusted professionals to ensure that you are taking various perspectives into consideration over the course of the home buying journey.
Check out the home buying process.