No You Do Not Need 20 Down To Buy NOW

Dated: 10/09/2017

Views: 53

 

No… You Do Not Need 20% Down to Buy NOW!

No… You Do Not Need 20% Down to Buy NOW! | MyKCM

The Aspiring Home Buyers Profile from the National Association of Realtors (NAR) found that the American public is still somewhat confused about what is required to qualify for a home mortgage loan in today’s housing market. The results of the survey show that non-homeowners cite the main reason for not currently owning a home, as not being able to afford one.

This brings us to two major misconceptions that we want to address today.

1. Down Payment

NAR’s survey revealed that consumers overestimate the down payment funds needed to qualify for a home loan. According to the report, 39% of non-homeowners say they believe they need more than 20% for a down payment on a home purchase. In actuality, there are many loans written with a down payment of 3% or less.

Many renters may actually be able to enter the housing market sooner than they ever imagined with new programs that have emerged allowing less cash out of pocket.

2. FICO® Scores

An Ipson survey revealed that 62% of respondents believe they need excellent credit to buy a home, with 43% thinking a “good credit score” is over 780. In actuality, the average FICO® scores of approved conventional and FHA mortgages are much lower.

The average conventional loan closed in August had a credit score of 752, while FHA mortgages closed with a score of 683. The average across all loans closed in August was 724. The chart below shows the distribution of FICO® Scores for all loans approved in August.

No… You Do Not Need 20% Down to Buy NOW! | MyKCM

Bottom Line

If you are a prospective buyer who is ‘ready’ and ‘willing’ to act now, but are not sure if you are ‘able’ to, let’s sit down to help you understand your true options.


Blog author image

Jennifer Fritsche

I believe that every family should be able to buy or sell a home with confidence. Selling your home quickly for the most value is my #1 goal when you list with me. I look forward to providing excellen....

Want to Advertise on this Site?

Latest Blog Posts

If You Are Not Seeing Results Check Your Price

 If Your Home Hasn’t Sold Yet… Definitely Check the Price!The residential housing market has been hot. Demand has remained strong ­throughout spring as many real estate professionals are

Read More

Why You Need To Sell This Summer

Why You Need To Sell This SummerThe market is hot, hot, hot! With interest rates at an all time low for buyers, the market has turned into a feeding frenzy, and home sales are skyrocketing in.

Read More

Why You Need An Agent For New Construction

Why You Need An Agent For New ConstructionAre you ready to buy a home and considering going in the route of new builds? It may seem like an easy enough process, where you get to call the shots of

Read More

A Few Storage Ideas For Small Bathrooms

Storage Ideas For Small BathroomsIs your bathroom small? It’s the worst, isn’t it? Well, unfortunately, small bathrooms are very common, and are usually the smallest rooms in the house. I can

Read More