Avoid These Very Common Home Buying Misconceptions | Home Buying In Boca Raton
It's Cheaper To Rent Than own
In 2006, prior to the real estate collapse 2 years later, home buying peaked and has dwindled ever since. Remaining effects of 2008, the mass migration of young people to major urban centers, and many Baby Boomers aging out of their home are a few examples of why. With a higher demand on rent, rental costs are skyrocketing. In 2015 alone, rental prices nationwide rose 4.6%. When considering the tax implications of a mortgage and nearly comparable prices of rent - why not pay what's often even less to own your Boca Raton home?
You need to make a 20% down payment
You technically don't need to reach this mark, with some mortgages beginning at as low as a 3% down payment. However, 20% is ideal and without that magic number, you may be forced to take out private mortgage insurance. With good enough credit and a history of on-time payments, you may be able to avoid reaching 20% to sign for your new home.
You need a very high credit score to buy a house
A good credit score is intrinsic to making a hard asset purchase like a car or home but is still only one of several major factors mortgage lenders take into account when you're applying. While a score at or above 700 is ideal, some FHA loans will take clients at a credit score as low as 600. If you have the assets and are on track to repair your credit, why not give it a try and begin your mortgage paperwork?
You can't qualify for a mortgage if you have student loans
Student loans are a scary thing for millions of Americans. However, there is hope. If you have a strong track record of paying these loans down, you can likely qualify for a home purchase. Lenders are not focused on the totality of your debt, rather the expectation that you'll be paying everything on time - using your credit score and track record as a whole as the key indicator. You should always pay loans with compounding interest down as aggressively as possible, but do not lament, these loans may not preclude you from investing in your dream home.
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