8 Myths Home Buyers Should Never Believe

Buying a home can be exciting, frustrating, and downright overwhelming. Before you embark on your home buying journey, you will find that friends, family and even co-workers will be supplying you with endless amounts of unsolicited advice. (Deep breath) Check out this list of the most common home buying myths and why you shouldn’t believe them.

1. Buy the Worst House in the Best Neighborhood

We've all seen the HGTV shows where the buyer comes in and takes literally the worst home on the block and makes it their dream home. While that's nice to watch, that strategy doesn't always pan out. If the cost of making the home livable will be sky-high, or if it has too many drawbacks that it can't be fixed, like if it's next to the freeway, then the house may not be a bargain after all.

2. Start Looking For Homes in the Spring

Spring is historically the most active time for real estate because both buyers and sellers are gearing up for the summer moving season. But there's no need to wait until the daffodils bloom to begin your home search. House hunting in the fall and winter may actually save you money because you'll probably be competing with fewer potential buyers, which may help keep prices down.

3. Skip the Buyers Agent and Go Straight For the Internet

Sure, you can find listings online. But a buyer's agent does more than just show what's for sale. If you are working with an experienced professional, they will also give you the lowdown on comparable homes in the market, steer buyers away from homes with potential problems, and provide guidance during negotiations.

4. Always Make a 20% Down Payment

With home prices on the rise, home buyers have a tougher time saving a cash down payment that amounts to 20 percent of the average purchase price. But wait, there's good news! You can usually get a house with a smaller up-front payment. The only caveat is that you will have to buy either private mortgage insurance or government insurance for at least a few years. It's important to note that this insurance can add hundreds of dollars to your mortgage payment each month.

5. Only Choose a 30 Year Fixed Mortgage

A loan term of this length is a good choice if you plan on staying in the house for a long time. However, there are other options available that are increasing in popularity that offer some nice advantages to homeowners. With a 15 or even 7 year loan, you could get the option for significantly lower interest rates. Be sure to explore all options when buying a home, and discuss the decision with several lenders.

6. Cash Buyers Always Win

This is one of the rare times when it's not all about the cash. While sellers love the simplicity of accepting a pile o' money instead of dealing with buyers who need financing, an all-cash offer isn't a guaranteed winner. If you are working with a good Realtor they will have done their research, and found out that what the seller is looking for is a shorter closing window, perhaps the ability to rent back until they find a home, or even a bid that is simply higher than the cash buyers. There are plenty of other ways to make your offer attractive, don't worry.

7. Prequalification Means a Guaranteed Loan

You can search online until your heart is content. But when you are seriously looking at homes, or you have found the one you want you will need to go through a lender's prequalification process to find out how much money you can actually borrow. It should be noted that banks don't always disclose how theoretical the prequalification amount can be. Once you start the actual qualification process, and the lender is doing a deeper dive of the buyers finances, it may decide to loan less, or nothing at all.

8. You’re Locked In Once Your Offer Is Accepted

Nope. You are not locked into an offer once it is accepted. While both parties have technically agreed to the offer, it's not final. If something arises in the inspection, or if the seller asks for unusually fast closing, you could negotiate price, terms, or even terminate the deal all together.

If you are in the market for a home, we are happy to be your professional representation throughout the process, contact us to get started!