2 Major Myths Holding Back Home Buyers

Urban Institute recently released a report entitled, “Barriers to Accessing Homeownership,” which revealed that “eighty percent of consumers either are unaware of how much lenders require for a down payment or believe all lenders require a down payment above 5 percent.”

Myth #1: “I Need a 20% Down Payment”

Buyers often overestimate the down payment funds needed to qualify for a home loan. According to the same report:

“Consumers are often unaware of the option to take out low-down-payment mortgages. Only 19% of consumers believe lenders would make loans with a down payment of 5% or less… While 15% believe lenders require a 20% down payment, and 30% believe lenders expect a 20% down payment.”

These numbers do not differ much between non-owners and homeowners; 39% of non-owners believe they need more than 20% for a down payment and 30% of homeowners believe they need more than 20% for a down payment.

While many believe that they need at least 20% down to buy their dream home, they do not realize that programs are available that allow them to put down as little as 3%. Many renters may actually be able to enter the housing market sooner than they ever imagined with programs that have emerged allowing less cash out of pocket.

Myth #2: “I Need a 780 FICO® Score or Higher to Buy”

Similar to the down payment, many either don’t know or are misinformed about what FICO^® score is necessary to qualify.

Many Americans believe a ‘good’ credit score is 780 or higher.

To help debunk this myth, let’s take a look at Ellie Mae’s latest Origination Insight Report, which focuses on recently closed (approved) loans.

As you can see in the chart above, 53.5% of approved mortgages had a credit score of 600-749.

Bottom Line

Whether buying your first home or moving up to your dream home, knowing your options will make the mortgage process easier. Your dream home may already be within your reach.

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1783 E Mulberry -- Prescott Valley, AZ 86314

$459,000

2 Beds

2 Baths

1,896 SqFt

Status Active

MLS # 6644241

Property Type Single Family Residence

Price Type --

Outstanding home in desirable 55+/Victorian Estates, Gated Community, providing a Quiet, Peaceful, Safe location with easy access to all shopping, entertainment, hospitals, doctors, etc. Here is a 1896 Square Foot/One level with 2 spacious Bedrooms, 2 Bathrooms, 2 Car Garage + Den & large Family Room/Media Room/Flex Room (Potential 3rd Bedroom), GREAT ROOM Concept, 2 Tone Paint, Crown Molding, Ceiling Fans, Wood Blinds, Wood Plank Tile, & Newer Carpet. Kitchen was upgraded in 2016 with Antique White Cabinetry, Dovetailed Drawers, GRANITE Countertops, Tile Backsplash, 2019 Stainless Steel Appliances (Including Fridge), built-in Pantry, & built-in China Hutch. Master is Spacious with His/Her Walk-In Closets, Dual Sinks under GRANITE Countertops, Full Tub with tile surround, & separate Shower with Glass Doors. Home also has Large Utility room w/Upper Cupboards w/(Washer/Dryer) Conveying. Has large Open Patio, Fenced Dog Run area for small dogs, Attic Storage, Security System, Security Screen Door, & is Walking Distance to Clubhouse & Pool.

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5363 E Santa Clara Drive San Tan Valley, AZ 85140

$459,000

4 Beds

2.5 Baths

2,222 SqFt

Status Active

MLS # 6658040

Property Type Single Family Residence

Price Type --

NO HOA! Situated on a corner lot that is almost a quarter acre, this stunning 4-bedroom, 2.5-bathroom home features a 2-car garage, a side-entry RV gate with RV hookup, 10ft entrance gate, and elegant stone details. Spacious great room with 12ft ceilings, recessed lighting, and stylish wood-look floors. The gourmet kitchen boasts granite countertops, white shaker cabinets, stainless steel appliances, subway tile backsplash, a pantry, and an island with a breakfast bar. The primary suite offers backyard access, a walk-in closet, and an en-suite with dual sinks. Enjoy a water softener system, a backyard oasis with a full-length covered patio, built-in BBQ, water feature, and lush turf. This home features a dual HVAC with a split system and a water softener system.

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3710 S 180th Lane Goodyear, AZ 85338

Open House

$459,000

3 Beds

3 Baths

1,955 SqFt

Status Active

MLS # 6691888

Property Type Single Family Residence

Price Type --

Welcome home to this energy efficient single story home in Las Brisas, Goodyear! A very spacious open concept allows plenty of room for entertaining. With granite counters, a large kitchen island and finished back yard with turf the inside and outside merge seamlessly. The 3 large bedrooms and 3 full bathrooms mean that everyone has their own space to get ready. The three car tandem garage makes way for all your cars and extras. The solar on this home is a steal with a low monthly payment to own, keeping you cool in the summer at a minimal cost!

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20395 N Shadow Mountain Drive Surprise, AZ 85374

Open House

$459,000

2 Beds

2 Baths

1,598 SqFt

Status Active

MLS # 6691261

Property Type Single Family Residence

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Welcome to your NEWLY UPDATED, OPEN CONCEPT home! This spacious home boosts new INTERIOR PAINT, new SHUTTERS throughout, new LVP flooring, new SHAKER cabinets and new QUARTZ counters in the kitchen, and a brand new A/C and FURNACE system! The Living area offers a dedicated space for a desk or sitting room. The Kitchen is a chef's dream! Stepping outside onto your large backyard patio, complete with a Built in BBQ and large covered area, you have plenty of shade and sun! This home is truly a MUST SEE!

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