Common First Time Home Buying Misconceptions

Common First Time Home Buying Misconceptions

Buying a home for the first time can be an exciting time in your life. However, there are misconceptions floating around that may give you cause for concern. Maybe you’ve heard things from family or friends that could deter you from buying your first home. But what was true about home buying years ago may not be the case today.  What are some of the misconceptions of buying a home?

  1. You need a 20% down payment to get a mortgage.

A few decades ago this was true. In fact, you needed almost perfect credit and had to pay 20% - 50% down for a mortgage.  To make it possible for more people to own a home, the government created the Federal Housing Administration and began offering “FHA Loans”. The FHA will now back a loan from a home buyer who only has a credit score of 500 and a 10% down payment. And for those with a better credit score of than 580, you only need 3.5% for a down payment! This is a big reason why more people can afford to buy a home today.

  1. You Can’t Qualify For a Mortgage With Student Loans

Having student debt doesn’t mean you can’t get a mortgage. Lenders look at your total debt-to-income ratio to see how much you make each month compared to all of your debt, no matter who you owe. So if you’re handling all of your debt responsibly and can still afford the payments, that’s what matters.

  1. You can save money by not using a real estate agent.

More people use a real estate agent today than ever before. You may think that agents are just out for the money. Sure they get paid for their services with a 3% commission.  But you don’t pay that fee as a home buyer.  Instead that fee is part of the selling price. Don’t be lured into thinking that you’ll save money by not using an agent. And don’t forget that they will also take care of all the paperwork, appraisals, inspections, and other matters that are part of the process. Imagine having to do all that by yourself. Let a professional with years of experience handle the process.

  1. It’s cheaper to buy a home that needs a lot of renovating.

Perhaps you’ve been inspired by TV shows that make it look like fixing up a house is the way to go. They make it almost look easy, but don’t be fooled. All of these repairs take time and money and in the end you may end up getting tired of all the renovations. So if you need to renovate the whole house to make it livable, it may not be the best choice.

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6708 Baker Avenue NE, Albuquerque, NM 87109  $205,000

2 Bedrooms / 2 Bathrooms (1 full, 1 half) / 1529 Square Feet

Excellent location! 2BDR/2BA/plus office townhome in Los Trechos! Many updates! REFRIGERATED AIR! Updated furnace, water heater and ROOF! Updated stucco (2013) Two large bedrooms plus a beautiful built-in office addition with cabinets & desk. Light & bright atrium for plants! Bath features a therapy tub! Kitchen has bkfst nook and all appliances stay! Private patio can be accessed from the master bedroom and living room. Convenient location close to shopping, restaurants, parks and transportation!!

Contact the Sandi Pressley team for additional details! 

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