The Truth Behind the 5 Most Common Home Buying Myths

There are many myths in almost every market in the world and the real estate market is no different. There are many home-buying myths related to your financial health, credit score, home inspection, the home-buying process, etc. 

You should be aware of the most common myths and the truth behind them. We are going to tell you about the 5 most common home-buying myths and the truth behind them.

 

Myth: Your Down Payment Must be 20%

There are many people who will tell you that the down payment for a home loan must be at least 20% which is not true. There are some lenders who take 20% down payment but most of the lenders take 5-10% for the down payment of the loan. It is one of the most common home-buying myths. Giving a higher down payment has benefits such as lower EMIs, which positively affect your loan eligibility and credit score. 

 

Myth: Your Credit Score Must Be Perfect to Buy a Home 

A credit score is indeed very important for loan approval because it is proof of your loan repayment ability and previous records. A low credit score will reduce your chances of getting a loan because it shows “not-so-good” financial health. Still, You can get loans from many housing finance companies. In developing countries like India, Having a low credit score is pretty common and that’s why these companies provide housing loans to applicants with low credit scores. There are also some government agencies and schemes that provide funds for the construction of houses to needy people fulfilling certain criteria.

 

Myth: You Must Pay off All Your Debt First 

If you want to apply for a new loan while you are already paying off an ongoing loan. It is possible and many people do it. If you are paying all the EMIs on time and you have a stable income then you can apply for another loan. Having more than one debt is common and if you have sufficient funds to handle these debts then you can apply for another one. All you need is a good credit score and sufficient funds.

 

Myth: You Do Not Need a Home Inspection 

Many people will suggest to you that a home inspection is not necessary and is a waste of money. The Truth is, Home inspection is important because these inspections are carried out by professionals who can point out even the most minute defects which will put you in a stronger position to negotiate over the price of the concerned property. A home inspection will give you the exact estimate of the worth of the property and make the home-buying process easier for you ensuring greater returns.

 

Myth: All Home Buying Experience Are the Same 

There is always going to be a difference between the home buying experience because all houses are different and the deal offered also varies with respect to many factors. Things such as location, type of house, financial health, the home-buying process, etc affect the home-buying experience. This experience can rarely be the same. There will always be a little difference in the home-buying experience.

There are many other home-buying myths but these myths are based on some ideal circumstances or scenarios experienced by few buyers the truth is different and has been discussed above. If you are applying for a home loan then you should also consider getting mortgage insurance. It is very helpful for all borrowers because of the protection it provides.