Three Real Estate Myths Houston First Time Home Buyers Should Avoid
Hello again and welcome to Houston First Time Home Buyers Edition, where we provide useful information to help you make the most informed decision when it comes to buying, decorating, and maintaining your first home. Today we're talking a bit about three (3) real estate myths first time home buyers should avoid at all cost.
When it comes to buying your first home, I do understand your friends and family may offer to help, by providing you with information. I really do. However, please keep in mind they may not have all the answers. And sometimes, there information may be more personal based than fact based. Working with a Trusted Real Estate Professional, can help to dispel all your real estate myths that may have prevented you for taking the necessary steps to becoming a homeowner. Here are 3 myths you should to avoid:
High Credit Score is Required
The first is regarding your credit score. Recently I had a prospective home buyer called to find out what he needed to do once he get his credit over 800. While I did let him know that I admire the work he is doing on his credit, I also let him know that his middle score did not need to be over 800 to qualify for a mortgage.
Having an 800 middle score is great, but it is not required to qualify for a mortgage. With down payment of 3.5%, you can get an FHA mortgage with a middle credit score of 620. In addition, you can also qualify for a FHA mortgage loan with a middle score that is lower than 580, however, a 10% down payment will be required.
Waiting For The Perfect Market to Buy - Otherwise Known as Timing the Market
Timing the market is a myth. As a real estate professional since 2011 working with first time home buyers, when a first time home buyer ask me when is the perfect time to buy their first home, my response is always the same. "The perfect time to buy your first home is when you are ready." If you wait for house prices to drop, interest rate will increase.
If you wait for interest rates to drop, house price will increase. It is extremely unlikely that both home prices and interest rates will be low at the same time. It would be nice if life works like that, but alas, it does not. Also, what if housing prices does falls, but does not affect the neighborhood, location or homes you are considering? What will you do then?
20% Down Payment Required
A lot of people falsely believe that a down payment of 20% or more is require to purchase a home. The reality is, while some home buyers do put 20% down, you do not have to. In addition to low down payment mortgage loans, there are mortgage loans that does not require any down payment at all, like USDA and VA. FHA down payment is only 3.5%. Also, the conventional 97 loan program allows qualifying borrowers to get a conventional mortgage loan with as little as 3% down.
Please do not let any of the above prevent you from moving forward with your home buying plans. There will most likely never be the perfect market for any home buyers, first time home buyers or seasoned home buyers. You just have to go for it. In addition, there are a bevy of lenders available to help you with your mortgage needs. Please let me know if you need a referral. Now that you know that a 20% down payment is not necessary, keep in mind there are also down payment assistance programs available to help you attain your real estate goal.
As always, thank you so much for stopping by. Remember, if you are thinking of purchasing your first home, please contact us. We are here to help. We have been helping Houston first time home buyers since 2011 and we can help you. I hope you have an amazing day. Until next time...Diana
