6 Common Misconceptions About Buying Your First Home

Buying property is often a confusing process. The unfamiliar terminology mentioned in every article read adds to the confusion. 

When purchasing your first property, the misconceptions and overwhelming information available does not help the situation. EvolveNV.com brings you the most common ones.

Credit Score Is Too Low

Online free credit score reports provide buyers with an idea of their credit risk falls. Buying a home is different. Lenders look at your overall financial picture—not just your standalone credit score. It includes debts, income, assets, down payment amount and loan amount.

Renting Is Cheaper

Monthly mortgage payments are often lower than renting an apartment or home. Instead of paying a property owner, you are creating equity in your new home and paying yourself.

Online Searches Are The Best Resource

Online searches can provide a plethora of information for first time home buyers. It helps when trying to decide between a conventional loan or an FHA loan. However, it is challenging to find answers to more specific questions for a particular market.

Buying a home is a significant investment. When it is your first home, you want to do it right. Online searches are not at customizable as speaking with a local lender. They can answer your specific questions. You will have a clearer understanding of your situation and your options.

Lengthy Loan Application Processes

Depending on the loan provider will determine how long you will spend completing the application process. Spend time researching each provider available. You can see what your options are and learn the timeline expectations.

If you are a veteran, consider using a VA loan provider such as Hero Loan. Their website, https://heroloan.com/, provides all the information needed to help you make an informed decision. There is also no lengthy application process to complete.

The Price You See Is What You Pay

You might put an offer on a $220,000 house. There is also a down payment of 20% to pay. An additional $44,000. You also have to factor in the closing costs once the sale goes through. These include escrow, taxes, attorney fees – all of which you will pay to third parties.

You Should Spend Most Of What You Qualify To Borrow

Your bank might be willing to let you borrow $500,000. It does not mean that you should accept the offer. Calculate the cost of buying your home. Include the closing costs and other expenses like taxes, repairs, and homeowners insurance. Create a reasonable monthly budget.

Borrowing less and putting down a higher payment means you can often lower your interest rate and monthly payments.