Free advice is a wonderful thing, but sometimes, hearing it from family friends or “experts” on the Internet can create some conflicting facts—especially when it comes to home buying. Since there are just so many conflicting opinions out there, we’re here to set the record straight and debunk some of the more common myths you may find out there. So, without further ado, keep on reading to see what the truth really is on these common misconceptions!
You Need a $20,000 Down Payment
Without a doubt, you want to make sure that the home you are buying is financially feasible, but that can mean a variety of things. For example, many people may shy away from a nicer home simply due to the price tag, and their lack of savings to provide a 20% down payment on the property. While it is true that putting down a larger down payment will result in a lower mortgage bill, you do not need to put down the 20%. Many private lenders will accept down payments as low as 5%, so long as you pay for private mortgage insurance. However, if you qualify for a Federal Housing Administration loan, you will get a government-backed mortgage with a down payment around 3.5% —no insurance needed. If you’re a veteran, VA loans require a 0% down payment. Explore your mortgage options, and you may be surprised to see what you fund.
You Can Skip the Home Inspection
Oh the home inspection—arguably one of the most contentious parts of the home buying process. Sure, by no means is it necessary, and by skipping it you can get into your new house quicker, but why would you want to skip it with the benefits that one offers? The entire purpose of the home inspection is to reduce the amount of surprises you encounter after moving in, and can give you an up-front image of what may need to be worked on in the house. Not only that, but whatever the inspector finds is just more ammunition for you at the negotiation table to get a better deal. With just those two benefits, you would be truly cheated to skip the inspection—it is arguably the best $400 you could spend.
An Agent Isn’t Necessary
With it advent of the Internet, nearly everything has become DIY-able. However, with something as important as a home (and remember, a home is the first large investment many people make), it would be unwise to leave something of that importance to the advice on the web. Knowledge is power, but when that knowledge is combined with experience, you have a one-two combo that is really hard to beat. You can leave your trust in a real estate agent, since they have a few tools in their arsenal that can expedite your home buying process—all the while securing you the best possible deal. Luckily enough, the agents at American Dream Realty of South Jersey are just that type—we can guarantee you that you’ll be in good hands.
These aren’t just the only myths out there, but at least we have lessened the burden a little bit. For more advice on home buying, selling, or ownership, check back to our blog regularly or stop into our office—we’d be happy to chat!