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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30924 W Catalina Drive Buckeye, AZ 85396

$459,000

4 Beds

3 Baths

2,684 SqFt

Status Active

MLS # 6673783

Property Type Single Family Residence

Price Type --

Explore the possibilities of this corner-lot home in Tartesso, offering an assumable low-rate FHA loan for qualifying buyers. With a practical design, this 2020-built DR Horton Onyx model features 4 bedrooms plus a flex room/den and 3 full baths. All bedrooms boast walk-in closets, and the front guest bedroom has a full ensuite bath. Inside, discover wood-look tile floors, recessed lighting, 2'' blinds, and a large great room with a double slider and electric fireplace. The kitchen is very functional with white cabinets, granite counters, a center island with a breakfast bar, walk-in pantry, modern pendants, and stainless-steel appliances. The primary bedroom is spacious and directly off the main living area. The primary bath includes an extended vanity, double sinks, a separate tub and shower, and a massive walk-in closet. Huge laundry room with plenty of space for an extra fridge or freezer. Great corner lot with a backyard large enough for endless upgrades. Create your own backyard oasis in the desirable community of Tartesso!

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914 E Osborn Road Phoenix, AZ 85014

$459,000

1 Bed

2 Baths

1,338 SqFt

Status Active

MLS # 6672294

Property Type Apartment

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Experience the ultimate urban lifestyle at the prestigious and award-winning Artisan Lofts on Osborn in Downtown Phoenix, situated conveniently across from Phoenix Country Club. This 1-bedroom, 2-bathroom unit spans 1,338 square feet and boasts contemporary urban design, an open layout, concrete floors, exposed ductwork, brick walls, new quartz countertops and state-of-the-art appliances. The building offers a range of amenities including a community pool, fitness center, rooftop deck, and secure parking garage. Each unit in this distinctive urban community is a unique masterpiece, just moments away from Central Avenue and the vibrant attractions of the Downtown Phoenix Corridor.

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3928 E Branham Lane Phoenix, AZ 85042

$459,000

3 Beds

2.5 Baths

1,708 SqFt

Status Active

MLS # 6675226

Property Type Single Family Residence

Price Type --

Well maintained home in a nice gated Blossom Hills subdivision. Main bedroom suite on ground floor, spacious loft and 2 bedroom and a bath on the second floor. Open great room with kitchen, living and dining space with a half bath and Harry Potter closet under the stair and a nice size laundry room. 2 car garage, shared driveway. Wood look tile on the main floor and newer carpet on stair and upstairs loft and bedrooms. Easy freeway access. Seller related to Listing Agent. There is a one time Benefit Working Capital Fee of 114.00

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8917 N 65th Drive Glendale, AZ 85302

$459,000

4 Beds

2 Baths

1,760 SqFt

Status Active

MLS # 6685460

Property Type Single Family Residence

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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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