The biggest myth we see with homebuyers: You need 20% down payment to purchase a home. A recent survey by the NAR (National Association of Realtors) showed that 44% of people who purchased a home in 2022 put less than 20% down.
For years, the idea of having to save up 20% of a home's purchase price for a down payment has been ingrained in many people's minds. However, this is no longer the case. While a 20% down payment may have been the norm in the past, there are now many options available for homebuyers to purchase a home with a much smaller down payment.
In fact, some programs allow for as little as 3% down payment for a conventional loan, and there are also government-backed loans such as FHA and VA loans that offer low down payment options as well. Additionally, there are down payment assistance programs available in many areas that can help homebuyers with their down payment and closing costs. It's important to note that a smaller down payment may result in higher monthly mortgage payments or additional mortgage insurance costs, but for many, the ability to purchase a home sooner rather than later is worth it.
Ultimately, it's important for homebuyers to do their research and speak with a trusted local lender to explore all of their options and find the best solution for their individual situation. The myth that a 20% down payment is necessary to buy a home is just that - a myth. Don't let it hold you back from achieving your dream of homeownership.
Check out our other blog posts below for additional buying education!