By Tiffany Diggs
You should be preapproved before you start looking at homes. TRUE.
It’s important to know how much you are qualified for before you start looking at homes. This allows you to narrow your search based on what you can afford and to move quickly when you find a home you want to put an offer on. Remember that you do not need to spend the full amount that you are approved for; be sure to stay within a budget that is comfortable for you. If you are able, get a full verified approval from your chosen lender.
You need a 10-20% down payment to purchase a home. FALSE.
This is simply not true. In fact, roughly 60% of homebuyers financed the purchase of their home using a down payment of 6% or less. There are also a multitude of homebuying programs that offer financial assistance.
The only thing you need to save for is the down payment. FALSE.
To prepare for the house hunt, I would make sure you are saving for not only the down payment, but also additional fees such as closing costs, escrow for insurance and taxes, a due diligence fee, earnest money deposit, inspection fee, and appraisal. These are all costs that are not always obvious or known to first-time buyers and can come as a surprise. However, your trusted real estate agent can help you understand each one.
You should create a wish list for your house hunt. TRUE.
When first meeting with your realtor, sit down with them to discuss your buying criteria such as budget, target area(s), style of home, bedroom/bathroom number, etc. While you may not be able to get everything on your wish list, it will keep you honest and ensure you are remaining on track throughout the process.
Whether you’re paying rent or a mortgage, your finances look the same (assuming the monthly amount is equal). FALSE.
The biggest benefit of a mortgage is that every payment brings you closer to full ownership of your home, whereas renting does not. In fact, renting contributes to someone else’s mortgage payment, bringing them closer to ownership. This is why even if you cannot afford to purchase a home at this time, look at down payment assistance programs and find out if you qualify. This could be the key to your dream of owning a home!
Tiffany Diggs has been a real estate agent with Keller Williams Ballantyne-Area for six years. For more information on buying a home, visit www.tiffanydiggs.kwrealty.com or email Tiffany at firstname.lastname@example.org.