Home buying dog memeFirst-time home buyers can feel intimidated by the steps needed to start owning and stop renting. Is my credit good enough? Do I make enough money? How do I even find the home I want?

Do you feel uncertainty holds you back? Ain’t nobody got time for that! Many of the home buying preconceptions you have probably heard aren’t true. Read along as we put five common home buying myths to rest.

Myth 1: “I need perfect credit!”

Yes, the best mortgage rates are available to those with preferably high credit scores. Does this mean you cannot buy a new home without that ideal 800 credit score? Not one bit!

Credit is just one piece of the pie when getting approved for a mortgage. The average Florida credit score is around 678 and our preferred lender partners are able to work with clients who even have below average credit scores by factoring in other criteria such as income and assets.

Each loan program has different qualifying criteria, with some offering eligibility even for those with scores under 620. Our preferred lenders can help you determine your purchasing power and find the right mortgage, as well as answer your credit and mortgage finance questions. And, if your credit is not quite where it needs to be to qualify, we work with a credit restoration specialist who can help you improve your credit, and your future.

Pre-qualify online with one of our preferred lenders today and stop doubting yourself!

Myth 2: “I need to have 20% down!”

Good news – you don’t need 20% down! This is probably the largest myth in home buying. Down payments vary by loan type and average much less than people think – in fact, we offer loan programs through our preferred lenders where you can purchase with just $99 down!

While having a large down payment does lower your monthly mortgage payment by a couple of dollars, handing over 20% for a new home is uncommon and, for most, unreasonable. According to a study conducted by the 2015 National Association of Realtors®, the average down payment for people born in Generation Y (1980s-1990s) was as low as seven percent and just ten percent for Generation X.

The average down payment hasn’t been around 20% since the Silent Generation (1920s-1940s) when the average home cost less than $10,000, meaning Grandma only put about two grand down on a brand-new home, gas was 11 cents a gallon, and life was good.

Myth 3: “My student loan debt makes owning a new home impossible!”

No one likes looking into their financial summary and seeing negatives up to the tens of thousands of dollars! Though this may be discouraging, this type of debt does not necessarily stop you from owning a home. You’re not alone in the war against student loans. According to a study conducted by the Institute for College Access & Success, 54% of Florida’s population has an average student loan debt of nearly $25,000.

One of the factors in mortgage qualification is your monthly debt to income ratio, or DTI. This compares your income to your new monthly housing payment, as well as the payment combined with your other monthly bills.

Federal Direct Student Loans and Income Based Repayment plans are pretty lenient, usually asking for around $100-$300 a month depending on how much you owe. Keeping your other monthly debts as low as possible gives you a better chance of getting qualified for a loan. So, that means don’t charge up credit cards, buy a new car, or sign up for any additional debt if you are considering a house purchase. Again, talking to a mortgage lender will give you a better idea of your overall buying power.

Myth 4: “Renting is the least expensive option!”

Parker home planRenting a home will never be less expensive than owning a home in the long run. Even in the short run, owning a home in Tampa is cheaper than renting if you plan to live in that house just a short 1.9 years.

Let’s face it – you are paying a mortgage whether that’s for your own home, or the mortgage of your landlord. The average rent in Tampa is $1,300 a month, and you can certainly own for around that payment. In addition, when you own a home, you can take advantage of tax benefits which will help you save or get money back on your tax returns each year.

When renting, you’re basically paying someone else’s bills and raising someone else’s equity! Home equity is a part of the property value that the mortgage borrower owns outright, increasing with every payment you make. Owning a home means having your own increasing equity and collateral which you can use to refinance your mortgage payments, fund major purchases, or just save for the future.

Myth 5: “I’ll save time and money buying an older home!”

Buying an older home is, for most, a bad investment. You’ll end up paying way too much trying to repair old construction and renovate rooms. Old homes can have unseen issues, such as mold spores, termites and infestations, and collapsing foundation. And, older homes have outdated layouts and style, and are often in less desirable neighborhoods.

New homes will save you much more money overall. With a newer home there is no need for renovation because you’ve chosen the home plan, exterior, and interior options for your life. At our Personal Selection Studio, you’re able to choose from hundreds of design options to personalize every room in your home. Modern design will allow you to take advantage of the open layout, private master bath, and designer kitchen you’ve been dreaming of. And, new home technological advancements from insulation upgrades to programmable thermostats can make an annual $1,000 difference in your utility bill!

Your First Step Towards Homeownership

There is absolutely no need to feel intimidated by the home buying process! Before doubting yourself, take the time to speak with professionals and ask questions which may have been daunting you! Our new homes in Tampa, Orlando, Lakeland, East Polk County, Manatee County, Ocala, and throughout Central Florida are affordably priced from the mid $100’s to $300’s with a variety of home sizes and layouts to choose from. To find your new home designed for your life, and get your home buying questions answered, contact our Florida new home specialists at (863) 797-4999 or send us a message online!