REACH YOUR GOALS

Dated: August 24 2022

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Misconceptions Held by First-Time Buyers

A recent survey discovered that some first-time buyers are unaware of all the mortgage options available to them. Are any of these common home buying myths affecting your plans?

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I need to put down 20%, right? Over 40% of would-be homeowners think they need to save 20% to buy a home...but this requirement has been obsolete for 66 years. This was because private mortgage insurance (PMI) was introduced in 1956 to help provide more mortgage options.

If my mortgage requires PMI, I'm stuck with it forever.
Did you know that 50% of Americans plan to wait until they've saved 20% down, so they can avoid PMI? Depending on your initial mortgage program, you can either:

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  • Cancel PMI when the principal balance of your mortgage is around 80% of its current appraised value.
  • Consider refinancing with a mortgage program that doesn't require PMI.

My parents can't help me with a down payment. Mortgages popular with first-time buyers often allow their relatives or employer to chip in with "gift funds". Nearly 37% of millennial buyers have had loved ones assist them in this fashion. However, buyers aren't allowed to use a personal, unsecured loan as part of their down payment.

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Rosario & Donna Panzarella

Your Real Estate Journey. Streamlined with Dual Expertise.At TrueNorth Group, we're more than just a real estate team—we’re a fully licensed duo in both real estate and mortgage lending, o....

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