Home Buyers: No need for a 20% Down Payment to Own Today!

Home / Home Buying / Home Buyers: No need for a 20% Down Payment to Own Today!

Home Buyers: No need for a 20% Down Payment to Own Today!

American home buyers are still unsure of what is actually required to qualify for a home mortgage loan in the current housing market, according to a survey by Ipsos. There are two main misunderstandings that are confusing home buyers the most, both of which need to be discussed.

  1. Down Payment

The survey showed that a misconception about down payments has potential home buyers thinking they need to spend much more on a down payment than necessary.

Approximately 36% of home buyers think that they need to put 20% down in order for them to qualify for a home loan. However, some loans may only ask for a down payment of 3% or less.

Many people who rent will be surprised to learn that they have the ability to purchase a home much earlier than expected. With new programs in the housing market coming in, it has become more attainable to receive a loan with less cash out of pocket.

  1. FICO Scores

Approximately two-thirds of survey takers also believed that a great credit score was required for them to buy a home. About 45% imagined a good credit score was around 780, when in actuality the average FICO scores required are much lower for an approved conventional and FHA mortgage.

Last March, an average credit score for a conventional loan was about 753 and FHA mortgages closed with an average score of 685. The average score for all loans in March was 722.

The graph below represents how the last 12 months have seen decreases in the average FICO score requirement, and how the average score has stayed around 722 for the last six months.

Home Buyers: No need for a 20% Down Payment to Own Today!

Bottom Line

Owning your dream home may not be as difficult as you think. Speaking with a qualified real estate agent is the best way to look at the options available, and to choose the route that best suits your needs and budget.

At Showcase Realty, we’d love to help you with your home buying needs! Looking to buy in the Mountain Island area? Send us a message and we’d be happy to assist you in finding the perfect home.

Are you a first-time buyer? Check out this report on the 9 buyer traps and how you can avoid them through this journey. We have helpful professionals if you would like to speak with us directly! Give us a call at 704.997.3794. We’re happy to help!

If you decide you don’t like your home we will sell it for free. *some conditions apply*

Recommended Posts
Contact Us

We're not around right now. But you can send us an email and we'll get back to you, asap.

Not readable? Change text. captcha txt

Start typing and press Enter to search

vacation homesThe Ultimate Guide to a Successful Open House