When researching mortgages, you’ll likely hear different answers to the same question. Misinformation spreads easily, especially when homebuyers rely on outdated advice instead of consulting a lender. To help clear up confusion, we’re breaking down six common mortgage myths and replacing them with the facts.

Myth #1: You Must Put 20% Down to Buy a Home

Many first-time buyers struggle to save a 20% down payment. Fortunately, plenty of loan programs offer low or even no down payment options.

• Conventional Loans: Fannie Mae’s HomeReady and Freddie Mac’s Home Possible programs allow eligible borrowers to put down as little as 3%.
• Government-Backed Loans:
  • VA Loans: Available to eligible veterans and active-duty service members with 0% down.
  • USDA Loans: Offer 100% financing but require the home to be in an eligible rural area.

A 20% down payment isn’t necessary. Exploring loan programs that fit your financial situation can make homeownership more accessible.

Myth #2: Every Lender Offers the Same Interest Rate

Many homebuyers assume mortgage rates are the same across all lenders. That’s not true. Rates, fees, and loan terms vary, making it essential to shop around.

A small difference in interest rates can significantly impact your long-term mortgage costs. Get multiple quotes to ensure you’re securing the best possible deal.

Myth #3: A Pre-Qualification Means You’re Ready to Buy

A pre-qualification offers an estimate of what you might qualify for based on self-reported information. However, it’s not a guarantee.

A pre-approval, on the other hand, is a written statement from a lender confirming your eligibility. It involves:

• Credit checks
• Income verification
• Financial review

Real estate agents and sellers take pre-approvals seriously because they confirm you’re a qualified buyer. Want to learn more? Check out our guide on Pre-Qualification vs. Pre-Approval.

Myth #4: You Need Excellent Credit to Get a Good Mortgage

While a higher credit score helps secure better rates, you don’t need perfect credit to buy a home. At Loan Pronto, we work with borrowers who have:

• 580+ credit score: Eligible for FHA loans
• 620+ credit score: Eligible for conventional loans

If your score needs improvement, consider strategies like paying down debt and making on-time payments to boost your mortgage eligibility.

Myth #5: Renting Is Cheaper Than Buying

At first glance, renting may seem like the cheaper option. However, homeownership offers long-term financial benefitsthat renting doesn’t.

• Building Equity: Each mortgage payment contributes to your ownership stake in the home. Rent payments, on the other hand, offer no return.
• Fixed Payments: A mortgage locks in a consistent monthly payment, while rent often increases annually.

When comparing costs, factor in potential appreciation, tax benefits, and the stability of owning versus renting.

Myth #6: The Mortgage Process Is Complicated and Miserable

At Loan Pronto, we’re changing the way mortgages work. Our fully digital process eliminates scanning, printing, and faxing—making home loans faster and easier.

• No lender fees
• Lender credit applied toward closing costs
• Close in as little as 14 days

We prioritize speed, transparency, and customer satisfaction to ensure your mortgage experience is stress-free.

Bottom Line

Understanding mortgage facts versus myths helps you make informed financial decisions. Whether you’re a first-time homebuyer or refinancing, choosing the right lender and loan program is key.

Ready to explore your options? Get pre-approved today!

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