Only 5 to 16 percent of respondents know the correct ranges for key mortgage qualification criteria according to a survey conducted by Fannie Mae.
Most people hold back from buying their dream home because they believe these two common myths.
“I need to put down 20% to buy my dream home.”
Consumers overestimate the down payment funds required to qualify for a home loan according to the same survey made by Fannie Mae.
It was found out that 76% of Americans either don’t know or are misinformed about the minimum down payment required.
Many Americans believe they are required to pay at least 20% down payment to buy the home of their dreams.
But there are programs that actually allow you to put down as little as three percent.
Millennials were asked about their recently purchased home.
In the graph below, you will see how much their down payment was.
There are 64.2% of the respondents who put down less than 20% to purchase their home with 43.8% putting down less than 10%.
You don’t need a 20% down payment to buy your dream home.
“I need 780 or higher in my FICO® Score to buy my dream home.”
Fifty-four percent of the respondents don’t know and five percent are misinformed about what FICO® score is necessary to qualify.
They believe that a good credit score is 780 or higher.
The graph below shows you the FICO® Score Distribution in Ellie Mae’s report on recent closed or approved loans.
More than half of the approved mortgages had a credit score of less than 780.
You don’t need to have a score of 780 or higher in your FICO® Score to buy the home of your dreams.
In conclusion,
Whether it’s your first time to buy your home or you’re moving up to your dream home, understanding what your options are will make the mortgage process easier.
Seeking the help of a professional before buying your home is important. At Burgess Group Realty LLC, we help our clients buy their dream home. Let’s meet up so we can help you find yours.
CALL Catherine at 303.506.5669.
