Two Major Myths Holding Oregon Home Buyers Back

Dated: 01/30/2018

Views: 127

Liberty First Realty Buyer Myths

2 Major Myths Holding Back Home Buyers

   Buying Myths, Down Payments, First Time Home Buyers, For Buyers, Move-Up Buyers

Urban Institute recently released a report entitled, “Barriers to Accessing Homeownership,” which revealed that eighty percent of consumers either are unaware of how much lenders require for a down payment or believe all lenders require a down payment above 5 percent.”

Myth #1: “I Need a 20% Down Payment”

Buyers often overestimate the down payment funds needed to qualify for a home loan. According to the same report:

Consumers are often unaware of the option to take out low-down-payment mortgages. Only 19% of consumers believe lenders would make loans with a down payment of 5% or less… While 15% believe lenders require a 20% down payment, and 30% believe lenders expect a 20% down payment.”

These numbers do not differ much between non-owners and homeowners; 39% of non-owners believe they need more than 20% for a down payment and 30% of homeowners believe they need more than 20% for a down payment.

While many believe that they need at least 20% down to buy their dream home, they do not realize that programs are available that allow them to put down as little as 3%. Many renters may actually be able to enter the housing market sooner than they ever imagined with programs that have emerged allowing less cash out of pocket.

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

Similar to the down payment, many either don’t know or are misinformed 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 Ellie Mae’s latest Origination Insight Report, which focuses on recently closed (approved) loans.

LFR FICO


As you can see in the chart above, 53.5% of approved mortgages had a credit score of 600-749.

Bottom Line

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

Latest Blog Posts

Portland Oregon Area Residential Real Estate Review March 2018

March Residential Highlights New listings in the Portland metro area saw a slight gain compared to last year this March. At 3,648 for the month, new listings edged 1.2% over the 3,604 new

Read More

Not Owning Your Home Can Cost You A Lot Of Money

NOT Owning Your Home Can Cost You a Lot of Money!  Monday April 2nd, 2018  Buying Myths, First Time Home Buyers, For Buyers, Move-Up Buyers, Rent vs. BuyOwning

Read More

Moving Up Is More Affordable Now In Portland Then In The Last 40 Years

Moving up Is MORE Affordable Now Than Almost Any Other Time in 40 YearsTuesday March 20th, 2018If you are considering selling your current home, to either move up to a larger home or into a home in

Read More

The Cost Of Waiting Portland Interest Rates Edition INFOGRAPHIC

Some Highlights: Interest rates are projected to increase steadily heading into 2019. The higher your interest rate, the more money you end up paying for your home and the higher your monthly

Read More