5 Myths About Buying a Home
Ready to take the leap from renter to homeowner? Buying a home is an exciting time, but many potential homebuyers are hesitant due to common misconceptions.
We debunk these common homebuying myths:
Myth #1: Your credit must be perfect to buy a home: Don’t worry; a lower credit score does not automatically disqualify you from getting a loan. Many factors are taken into account, such as your income, debts, assets, and employment history.
Myth #2: You need a certain amount of money in your savings: Generally, it’s a good idea to have a decent amount of money stored away in your savings to help with a down payment, closing costs, and to have available in case of an emergency. However, there is no set amount you need in your savings account to apply.
Myth #3: It is less expensive to rent: Renting and buying both have their benefits and, depending on your situation, one might be a better option for you than the other.
Buying offers the possibility of lower monthly payments and your monthly principal and interest payments will stay the same for the life of a fixed-rate mortgage. In addition, owning a home allows you to build equity, which is wealth you can use to reach your financial goals!
Myth #4: A 30-year loan is the best option: Although many first-time homebuyers elect for a 30-year mortgage, it’s not the only option worth considering. A 15- or 20-year home loan provides a great way for you to spend less money on interest. You just want to make sure this option works well for your budget. A shorter loan term does mean higher monthly payments, but your interest will be lower.
Myth #5: A 20 percent down payment is mandatory: Generally, the more money you put down on a home the better off you will be in the end. While 20 percent is considered the ideal amount – as you will have less to pay back and you will not be spending as much on interest over the life of the loan.
Want To Discuss More? Message me or send an email at beataw@dominionlending.ca
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