True or False? Debunking 3 Homebuying Myths!

True or False: You need a 20% down payment to buy a house.

FALSE! A 20% down payment hasn't been required to buy a home for decades, if ever. Many home loans allow a down payment as low as 3%, as long as your loan amount is less than the so-called “conforming' loan limit for the county where the home you want to buy is located.

True or False: Your preapproval rate is the rate you'll get when you close.

FALSE! Interest rates adjust daily. The rate you're quoted in a preapproval is based on current market conditions as well as factors like your loan amount, credit score, property type and where the home is located. In general, your actual rate can't be “locked in' until you find a home and sign a purchase contract with the seller.

True or False: Renting a home can sometimes be cheaper than buying.

TRUE! Renting a home can sometimes be cheaper than buying, and home prices don't always go up and up in a neat, straight line. However, a home you own is an asset that can appreciate over time. A rental may appreciate as well, but as a renter, you won't capture that additional value; the property's owner will.