Myth: You need about 10% down payment on a house.
Most consumers, in fact 20% of them according to Fannie Mae, believe that you need between 6% and 10% as a down payment. The reality is that most home buyers only need to put down 1% to 5%.
Interestingly, 40% of consumers have no idea how much of a down payment they need. Think about that: 4 in 10 people have no idea how much down payment is needed.
What to do: Think in terms of a 3% to 10% down payment. That can help you get into a home faster.
Myth: You need to do this all alone.
The reality is that there are a lot of people and organizations that can help you buy a home. Here is a short list to expand your horizons:
1. Family members - Nearly one-third of home buyers get monetary assistance from family members. For example, older folks, like those over 70, have a net worth over $250,000. They are often willing to loan out some of that to the younger generation to buy a home.
2. Down payment assistance programs - There are over 2,500 assistance programs in the country. They range from city and state plans to federal programs. Veterans can buy a home with no money down. Many unions have down payment assistance. There are many, many programs.
3. Lenders - Talk to your lender. It's in their interest to get you into a home. They might have ideas that will apply just to you.
What to do: Consider every possible option, including groups that you belong to or did, family members, employers, unions, and more.
These two myths stop hundreds of thousands of potential home owners from trying to buy a home every year. By understanding the truth, it can open the door, the front door, to a new home.