Archive for February 2023

If you're thinking about buying a home in Annapolis, Maryland in 2023, you might be wondering how to get started. The home buying process can be daunting, especially if you're a first-time buyer. Unfortunately, there are several myths out there that can stop you from taking the first step towards building wealth through home ownership. In this post, we will debunk the top 5 buyer myths that might be stopping you from buying a home and building wealth.

Buyer Myth 1: Thinking You Need To Put 20% Down
While a larger down payment can help you avoid private mortgage insurance (PMI), it's not necessary to put 20% down. Depending on your financial situation and the type of loan you qualify for, you could put as little as 0% down if you're using a VA or USDA loan, 3.5% if you're using an FHA loan, or 3-5% for some conventional loans. The average down payment for first-time homebuyers in 2021 was only 7%, and for repeat buyers, it was 17%.

Buyer Myth 2: Thinking You Don't Have Enough Cash
Another common myth that stops buyers from taking the first step. However, keep in mind that sellers can and may pay for your closing costs. In fact, 42% of home sales in Q4 of 2022 resulted in sellers giving concessions to buyers. This is something that your real estate agent can discuss with you when writing and presenting an offer on a home. Don't let the fear of not having enough cash stop you from reaching out to a realtor to discuss your options.

Buyer Myth 3: Thinking Your Credit Isn't High Enough
Your credit score is a crucial factor in qualifying for a mortgage, but it's not the only factor. While a conventional loan generally requires a 620 credit score, you can qualify for an FHA loan with a 580 credit score. Even if your credit score is not where you want it to be, don't let that stop you from reaching out to a lender. They can help you develop a plan to improve your credit score and increase your chances of qualifying for a loan. They can also help you explore different loan options that might be a good fit for your financial situation.

Buyer Myth 4: Thinking The Interest Rate You Got From One Lender Is Your Only One
Many buyers make the mistake of thinking that the interest rate they got from one lender is the only rate they can get. However, it's always a good idea to shop around to find the best rate. You can also explore different ways to lower your interest rate, such as buying it down, asking the seller to buy it down, or exploring adjustable-rate mortgages.

Buyer Myth 5: Now is Not a Good Time to Buy
This is a myth that we hear all the time, especially when there's a lot of uncertainty in the real estate market. However, it's important to remember that real estate markets are local, and what might be true in one area might not be true in another. In January 2023, the Annapolis and surrounding area real estate market is stable, with fewer bidding wars and more opportunities for seller concessions. It's always a good idea to reach out to a real estate agent and ask them about the current market conditions in your area.

In conclusion, don't let these buyer myths stop you from taking the first step towards building wealth through home ownership. Reach out to a real estate agent to discuss your options!