Fact vs. fiction: Myths about homebuying
You decided you’re ready to buy a house, but you’re hearing rumors about the homebuying process. The myths about homebuying can make it difficult to find the place of your dreams.
Here are some of the most common myths and their truths.
Myth No. 1: You need a 20% down payment
To avoid the private mortgage insurance, or PMI, putting a 20% down payment on a home is ideal; however, there are some mortgage loans that will allow less than that. For instance, government-backed Federal Housing Administration (FHA) mortgage loans have relatively low closing costs and down payment requirements of as little as 3.5%. Veteran’s Administration (VA) mortgage loans have no down payment requirements.
Myth No. 2: The down payment is the only up-front cost
Not only are you responsible for the down payment on your home, but the closing costs, fees, taxes, and inspection. You’ll also have to get homeowners insurance to cover potential damages to the property and loss of personal belongings. With owning a home, you may also need to consider budgeting for property taxes, homeowners association fees, and any moving expenses. Additional costs may include any home renovations or repairs, trash pick-up fees, and other bills associated with your home.
Myth No. 3: You don’t need a home inspection
There is a high risk if you don’t have an inspection done on the home. Many lenders require a home inspection. It is used to identify potential problems in the home from leaks to a cracked foundation. It is vital that you are aware of these issues so you can negotiate for repairs or walk away from the deal.
Myth No. 4: The asking price is non-negotiable
The asking price on a home is not set in stone. You can negotiate the price. If you had the home inspected and issues turn up, you can use those problems when negotiating the price.
Myth No. 5: Go with a 30-year mortgage
Conventional fixed-rate mortgage terms may be 10, 15, 20, or 30 years. Contact Adirondack Bank to discuss what term and mortgage loan work best for you and your financial lifestyle.
Buying a home?
If you’re ready to buy a home, Adirondack Bank is here to provide you expert advice from the beginning of your home financing journey to the end. Let our team of professional and dedicated staff help you choose the mortgage product that’s right for you.
The information in this article was obtained from various sources not associated with Adirondack Bank. While we believe it to be reliable and accurate, we do not warrant the accuracy or reliability of the information. Adirondack Bank is not responsible for, and does not endorse or approve, either implicitly or explicitly, the information provided or the content of any third-party sites that might be hyperlinked from this page. The information is not intended to replace manuals, instructions or information provided by a manufacturer or the advice of a qualified professional, or to affect coverage under any applicable insurance policy. These suggestions are not a complete list of every loss control measure. Adirondack Bank makes no guarantees of results from use of this information.
