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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8917 N 65th Drive Glendale, AZ 85302

$459,000

4 Beds

2 Baths

1,760 SqFt

Status Active

MLS # 6685460

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This is the best house in the neighborhood! It has been completely remodeled by a licensed contractor. The house features a new roof and HVAC system, as well as fresh paint both outside and inside. Additionally, there are new tile floors throughout the entire house. As you enter, you'll be greeted by a spacious living room filled with natural light. The kitchen has undergone a complete transformation with new cabinets, quartz countertops, and stainless steel appliances. Both bathrooms have also been completely redone, including new vanities, cabinets, countertops, fixtures, and tiled showers. Outside, you can enjoy the patio and the low-maintenance yard. Don't miss out on the opportunity to own this beautiful home.

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16 W Encanto Boulevard Phoenix, AZ 85003

$459,000

2 Beds

2.5 Baths

1,709 SqFt

Status Active

MLS # 6685494

Property Type Apartment

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Don't miss out on over 1,700 sqft of Midtown Luxury! This private end unit is the largest City Home floor plan and is priced to sell. There are only 4 units at Tapestry with this desirable floor plan. You will enjoy all the windows making it light and bright. Features include upgraded stainless appliances, granite counter tops, gas range and a gas fireplace. The first floor also has beautiful laminate flooring and a large patio. There are two large bedrooms upstairs with lots of closet space. The primary suite has a walk in closet and a nice private balcony that is north facing for year around use. Located just minutes from shopping via a short drive or the light rail. You can even take the light rail to Phoenix Sky Harbor Airport. This home has two assigned parking spaces in the secured underground parking too. On site amenities include a fitness center, club house, large heated pool and spa, a Walgreen's pharmacy is on site as are a nail salon and a new art studio too.

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30520 W Clarendon Avenue Buckeye, AZ 85396

$459,000

5 Beds

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2,658 SqFt

Status Active

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Welcome to your canvas! This beautiful move-in ready, spacious home, is ready for your personal touch. As you pull up to the home you will be grateful for the 3 car garage and RV gate perfect for storing your cars, toys and holiday decor, as well as having your own ''she shed''. As you walk inside you will not be disappointed with the open living space and gourmet kitchen that will meet your needs and more! This desirable floor plan is great for a multi generational home or someone looking for all the space, with 5 bedrooms and 3 full bathrooms. And the backyard is ready for you to turn it into your outside oasis! OH! And did I mention it has OWNED solar?! Don't miss it!

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$459,000

2 Beds

2 Baths

1,584 SqFt

Status Active

MLS # 6688997

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Fantastic Ranch Home in Fountain of the Sun, a 55+ Community. Move-in Ready, 2 bed, 2 bath home with a private, gated, backyard pool. Updates include refaced kitchen cabinets, quartz countertops and all new LG kitchen appliances 2023. Large owner's bedroom suite, French door entry, updated bath, new vanity & walk-in closet. Guest bedroom has a new Murphy-style wall bed unit that converts to a desk ($7k) and a walk-in closet. High-quality window shutters throughout the entire home. Beautiful, private backyard with heated salt-water pool, new pump & salt cell in 2019. Newer roof & outside paint. Enjoy all the Fountain of the Sun amenities including pickle ball, bocce ball, a dog park and much more. The 18-hole executive golf course & country club make this a very special place to live.

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