Two Myths About Mortgages That May Be Holding Back Buyers

Fannie Mae’s “What do consumers know about the Mortgage Qualification Criteria?” Study revealed that Americans are misinformed about what is required to qualify for a mortgage when purchasing a home and these two myths may be holding buyers back.

two myths

Myth #1: “I Need a 20% Down Payment”

The first of two myths is Fannie Mae’s survey revealed that consumers overestimate the down payment funds needed to qualify for a home loan. According to the report, 76% of Americans either don’t know (40%) or are misinformed (36%) about the minimum down payment required.

Many believe that they need at least 20% down to buy their dream home. New programs actually let buyers put down as little as 3%.

Below are the results of a Digital Risk survey of Millennials who recently purchased a home.

2 Myths About Mortgages That May Be Holding Back Buyers | Keeping Current Matters

As you can see, 64.2% were able to purchase their home by putting down less than 20%, with 43.8% putting down less than 10%!

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

The survey revealed that 59% of Americans either don’t know (54%) or are misinformed (5%) 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 the latest Ellie Mae Origination Insight Report, which focuses on recently closed (approved) loans. As you can see below, 54.1% of approved mortgages had a credit score of 600-749.

2 Myths About Mortgages That May Be Holding Back Buyers | Keeping Current Matters

What this means to a Home Buyer

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

img

darlington

Related posts

Low Inventory Pushes Home Prices Higher

According to CoreLogic’s latest Home Price Index, home prices appreciated by 6.9%...

Continue reading
by Goodacre Properties

A great list of March Events around Boulder and Boulder County

The fine folks over at BoulderColoradoUSA .com have put together a great list of March Events...

Continue reading
by Goodacre Properties

The #1 Reason To Sell Before Spring

Now is the time to sell before spring arrives. The price of any item (including residential real...

Continue reading
by Goodacre Properties

Join The Discussion