{"id":48596,"date":"2021-11-15T17:48:36","date_gmt":"2021-11-16T01:48:36","guid":{"rendered":"https:\/\/www.movoto.com\/blog\/?p=48596"},"modified":"2022-04-19T22:42:57","modified_gmt":"2022-04-20T05:42:57","slug":"10-common-myths-of-the-home-buying-process","status":"publish","type":"post","link":"https:\/\/www.movoto.com\/blog\/10-common-myths-of-the-home-buying-process\/","title":{"rendered":"10 common myths about the homebuying process"},"content":{"rendered":"<h2 style=\"font-weight: 400\"><strong>1. You need 20 percent down to buy<\/strong><\/h2>\n<p>Although it is true that most conventional loans require a 20 percent down payment, there are a handful of loans out there that cater to different financial needs. It\u2019s not uncommon to be short some savings when it comes to thousands of dollars.<br \/>\nYou can typically qualify for an <a href=\"https:\/\/www.movoto.com\/foundation\/basics\/types-of-mortgage-loans\/?utm_source=movoto&amp;utm_medium=blog&amp;utm_campaign=article_link\">FHA<\/a> or VA loan or a down payment assistance program and put as little as 3.5 or 0 percent down. Keep in mind that if you don\u2019t pay 20 percent down, you\u2019ll need to pay <a href=\"https:\/\/www.movoto.com\/blog\/what-does-a-mortgage-down-payment-mean-what-is-pmi\/\">private mortgage insurance (PMI)<\/a>.<\/p>\n<h2 style=\"font-weight: 400\"><strong>2. You need amazing credit<\/strong><\/h2>\n<p>In order to get the best mortgage rates available, you usually have to have great credit. The lower your credit, the worse the rates available to you become\u2014and if it\u2019s low enough, you might not even be offered a loan at all.<br \/>\nBut if you want to become a homeowner before you can <a href=\"https:\/\/www.movoto.com\/blog\/7-ways-to-boost-your-credit-score\/\" target=\"_blank\" rel=\"noopener noreferrer\">repair your credit<\/a>, there are options. The credit guidelines for an FHA loan are much more lenient than for most conventional loans. Your <a href=\"https:\/\/www.movoto.com\/blog\/how-can-credit-monitoring-help-increase-and-maintain-good-credit\/\">credit score<\/a> can be as low as 580 to qualify (and you\u2019ll only be required to pay 3.5 percent down).<\/p>\n<h2 style=\"font-weight: 400\"><strong>3. Your income determines how much you can borrow<\/strong><\/h2>\n<p>While your debts are considered when it comes to the loan amount you can get, your monthly or annual income isn\u2019t always a determining factor.<br \/>\nFor example, it might be harder for you to get a large loan if you make $60,000 a year with significant credit card debt than if you make only $45,000 with no debt.<\/p>\n<h2 style=\"font-weight: 400\"><strong>4. Pre-qualification is the same as preapproval<\/strong><\/h2>\n<p>Confusingly, these <a href=\"https:\/\/www.movoto.com\/blog\/mortgage-pre-qualification-vs-pre-approval\/\">two terms don\u2019t mean the same thing<\/a>. To get pre-qualified, you give your lender basic information about you (assets, income, debts, etc.) so they can determine what kind of loan you can qualify for and estimate how much you\u2019d be eligible to borrow.<br \/>\nBut not until the lender is ready to give you a loan by verifying the information you provided are you actually preapproved. You\u2019ll have to complete a mortgage application after your lender evaluates your financial background and credit rating.<\/p>\n<h2 style=\"font-weight: 400\"><strong>5. All agents are the same<\/strong><\/h2>\n<p>While you\u2019ll hear from time to time that no two real estate agents are different, that\u2019s far from the truth. Some <a href=\"https:\/\/www.movoto.com\/blog\/what-does-a-real-estate-agent-do\/\">agents<\/a> provide better service than others, have more years of expertise, and are more experience in a given area or neighborhood.<br \/>\n<a href=\"https:\/\/www.movoto.com\/about\/agents\/?utm_source=movoto&amp;utm_medium=blog&amp;utm_campaign=article_link\" target=\"_blank\" rel=\"noopener noreferrer\">Movoto agents<\/a> are all hand-selected from a pool of competitive applicants who are intimately acquainted with their local markets, where they do at least 10 real estate transactions per year.<br \/>\n&nbsp;<\/p>\n<h2 style=\"font-weight: 400\"><strong>6. The seller pays the closing costs<\/strong><\/h2>\n<p>Many people have probably heard from family or friends that the seller of the home they bought covered their <a href=\"https:\/\/www.movoto.com\/blog\/how-long-to-close-on-house\/\" target=\"_blank\" rel=\"noopener noreferrer\">closing costs<\/a>. While this can be true in many cases, it\u2019s just as common for the seller to not agree to pay for them at all.<br \/>\nIt\u2019s important to recognize the amount you need to provide upfront for costs such as a credit report, a survey fee, title services, an attorney fee, and property insurance. Typically, closing costs are 2 to 5 percent of the purchase price of the home.<\/p>\n<h2 style=\"font-weight: 400\"><strong>7. The seller will make repairs based on the inspection report<\/strong><\/h2>\n<p>Your real estate agent will assist you as much as they can when it comes to negotiating repairs after a <a href=\"https:\/\/www.movoto.com\/blog\/what-you-should-know-complete-home-inspection-checklist\/\" target=\"_blank\" rel=\"noopener noreferrer\">home inspection<\/a>, but you won\u2019t always be so lucky. If they won\u2019t hire someone themselves to do the repairs before you close, and then won\u2019t offer you cash-back credits for you to hire your own professional to come in, you\u2019re probably on your own.<br \/>\nThis is the \u201ctake it or leave it\u201d approach during the homebuying process, and either they\u2019re in no rush to move and can wait for more offers to come up, or they already have multiple offers on the table (one of which may not have asked for repairs assistance).<\/p>\n<h2 style=\"font-weight: 400\"><strong>8. The asking price is the selling price<\/strong><\/h2>\n<p>You may look at a home that really interests you but not even bother pursuing it if it\u2019s out of your price range. However, there are many factors to consider when it comes to what you can put in for an offer and what you may be able to walk away with.<br \/>\nIf the home has been sitting on the market for quite some time, it could be a good indication that it\u2019s overpriced. Many <a href=\"https:\/\/www.movoto.com\/blog\/8-mistakes-when-buying-and-selling\/\">sellers<\/a> will be willing to bring the price down significantly. If an inspection comes back with some repairs to be made to the home, the seller may also reduce the asking price.<\/p>\n<h2 style=\"font-weight: 400\"><strong>9. The down payment is the only upfront cost<\/strong><\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-48598\" src=\"https:\/\/movoto.kinsta.cloud\/wp-content\/uploads\/2021\/02\/blog-common-myths2.jpg\" alt=\"10 Common Myths Of The Home Buying Process - Movoto Real Estate\" width=\"715\" height=\"359\" \/><br \/>\nWhile it may appear to be the case at first, as you get closer to the end in the homebuying process, closing costs will surface. Like we said above, while in many cases the seller will cover some or all of the closing costs, sometimes they won\u2019t cover anything at all.<br \/>\nAfter moving in, you\u2019re sure to discover some things that need to be repaired or improved, and you\u2019ll probably spend some money furnishing your new home as well. And don\u2019t forget that emergency fund\u2014you\u2019ll need to have some extra cash after moving in to cover expenses like your mortgage payment if you run into financial difficulties (i.e. losing your job).<\/p>\n<h2 style=\"font-weight: 400\"><strong>10. It\u2019s cheaper to rent than buy<\/strong><\/h2>\n<p>This is one of the most controversial topics surrounding the <a href=\"https:\/\/www.movoto.com\/blog\/10-common-myths-of-the-home-buying-process\/\">homebuying process<\/a>, and it really does come down to a personal decision. However, studies show that in today\u2019s market, rent prices are actually increasing faster than home prices\u2014and if you had to choose between paying a landlord monthly or paying your own mortgage bill monthly, wouldn\u2019t you rather that money go to YOU and your personal assets in the end over a stranger\u2019s?<br \/>\nOf course, <a href=\"https:\/\/www.movoto.com\/blog\/rent-vs-buy-what-you-should-consider-when-choosing\/\">renting comes with the flexibility<\/a> of moving and doesn\u2019t come with the cost of repairs and improvements, but <a href=\"https:\/\/www.movoto.com\/foundation\/basics\/9-reasons-buy-home-instead-rent\/?utm_source=movoto&amp;utm_medium=blog&amp;utm_campaign=article_link\" target=\"_blank\" rel=\"noopener noreferrer\">owning<\/a> comes with a potentially lifelong investment and endless customization. And while the homebuying process may not be cheaper than renting in all markets (like <a href=\"https:\/\/www.movoto.com\/new-york-ny\/?utm_source=movoto&amp;utm_medium=blog&amp;utm_campaign=article_link\" target=\"_blank\" rel=\"noopener noreferrer\">New York<\/a> and <a href=\"https:\/\/www.movoto.com\/san-francisco-ca\/?utm_source=movoto&amp;utm_medium=blog&amp;utm_campaign=article_link\" target=\"_blank\" rel=\"noopener noreferrer\">San Francisco<\/a>), it\u2019s important to do your research and <a href=\"http:\/\/www.nytimes.com\/interactive\/2014\/upshot\/buy-rent-calculator.html?_r=0\" target=\"_blank\" rel=\"noopener noreferrer\">calculate <\/a>which would be a better deal for you in your own neighborhood.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>1. You need 20 percent down to buy Although it is true that most conventional loans require a 20 percent down payment, there are a handful of loans out there that cater to different financial needs. It\u2019s not uncommon to be short some savings when it comes to thousands of dollars. You can typically qualify for an FHA or VA loan or a down payment assistance program and put as little as 3.5 or 0 percent down. Keep in mind that if you don\u2019t pay 20 percent down, you\u2019ll need to pay private mortgage insurance (PMI). 2. You need amazing [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":48599,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[223],"tags":[95,172,176,153,202,198,178,112,113,69],"class_list":["post-48596","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying","tag-closing-costs","tag-credit-score","tag-down-payment","tag-home-inspection","tag-income-to-debt-ratio","tag-prequalification","tag-preapproval","tag-renting","tag-renting-vs-buying","tag-working-with-agents","post--single"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.1.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>10 common myths about the homebuying process<\/title>\n<meta name=\"description\" content=\"Its easy to have misconceptions of the homebuying process. 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