7 Debunked Home-Buying Myths That Show You Can Own A Home Without Giving Up Avocado Toast

You could have your home and eat avocado toast, too! Talk to your local lender to learn more.

1. Renting is obviously cheaper, so buying's not even worth exploring.

While the upfront costs of buying a home may be greater than renting, there’s no one-size-fits-all solution to the rent vs. buy question. Sometimes rental rates can be higher, but not always! Ultimately, it's up to you to determine the best option that fits your situation, and the more educated you are, the better informed you'll be.

2. You need to have a 20% down payment to purchase a home.

Putting more money down up front could save you money in the long run, but a 20% down payment isn’t actually mandatory. You may be able to put down as little as 3%. According to a survey by the National Association of Realtors, the median down payment made by first-time home buyers in the last six years was only 6%. Buyers who borrow more than 80% of their home’s value, however, are required to purchase mortgage insurance, which helps protect the lender in the event that the buyer can’t pay off their mortgage.

3. You can’t buy a home unless you have a perfect credit score.

The truth is you don’t need perfect credit to qualify for a mortgage; there are a number of mortgage products that consider not-so-perfect credit scores. You can learn more by talking to a lender in your area about affordable options that meet your needs.

4. The list price is final.

The list price for a house is an opening bid. While some sellers might not budge (or might even end up asking for more based on multiple offers), others might be more willing to come down in price. Get comfortable with the idea of negotiating, because that’s how you’ll get the best price.

5. The internet is just as good as a real estate agent.

The internet is a great resource, but it’s not necessarily a substitute for the knowledge and negotiating expertise of a good real estate agent. Consider finding the right real estate agent by asking friends and family for their recommendations, interviewing a few candidates, and asking detailed questions about how they work.

6. The lender with the lowest interest rate is the best option.

The interest rate on a loan is just one of several considerations. Lenders sometimes offset low interest rates with additional fees, and some low-interest loans can see their rate increase over time. Do your due diligence with a little comparison shopping: Talk with at least three lenders and compare all the terms, features, and costs of a loan before making a decision.

7. You should put every last penny you can afford down to lower your monthly payment.

It’s true that the more you pay up front for your home, the less you need to borrow. And the less you borrow, the lower your monthly payments will be and the less interest you’ll pay over the life of the loan. But there are other considerations you should take into account when deciding how much to put down: Putting all your savings into your home means you have less cash on hand for improvements, repairs, and other costs, including unexpected expenses that arise.

Owning a home is now more achievable than ever! Click here to learn about low down payment options, and be sure to talk to a lender near you to discuss how you could own a home with as little as 3% down.

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