It’s common for first-time homebuyers and experienced homeowners to feel overwhelmed by the purchasing process. Plus, myths and misconceptions often make the experience even more confusing.
Myths like: Renting is cheaper than buying. A credit score of 700 is required to get a loan. You shouldn’t buy in a seller’s market. Have you come across any of these?
If you’re thinking of buying this year, don’t let these misleading ideas deter you from your goals.
Myth #1: You need a certain credit score. While mortgage programs have minimum credit scores, you’d be surprised how low those go. With an FHA loan, you may be able to get financing with a score of 500. (Know that your score may also affect the interest rate and terms of the loan.)
Myth #2: You should only buy during certain seasons or under certain market conditions. While competition may seem fierce lately, that doesn’t mean you shouldn’t buy a house. As long as you choose a home you can afford and one that will grow in value, it’s still a wise long-term investment.
Myth #3: It’s cheaper to rent than buy. Home prices have risen lately, but rents have also jumped significantly. Since homeownership allows you to build equity and wealth over time, it’s important to crunch the numbers before assuming you’re better off renting.
Myth #4: You should get a mortgage from your bank. Check with your bank, but don’t limit your shopping to just them. Get quotes from several local mortgage lenders to ensure you get the best deal.
Myth #5: You should waive your option period to win a bidding war. Waiving your right to a termination option might help you beat out other offers, but it can also come back to bite you. Inspections often reveal costly and even dangerous defects, and you’ll want to know about these before deciding to buy. If you don’t waive your option period and you receive a scary inspection, you still have the right to terminate the contract without losing your earnest money. (You will be out the cost of the option fee as well as any inspectors’ fees).
Have questions about buying or selling a home? Get in touch today. Call, text or email Karin Chappell – 512.589.7637 0r firstname.lastname@example.org