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No… You Do Not Need 20% Down to Buy NOW!

Thursday, October 12, 2017   /   by Linda Dale

No… You Do Not Need 20% Down to Buy NOW!


No… You Do Not Need 20% Down to Buy NOW!




No… You Do Not Need 20% Down to Buy NOW! | MyKCM



The Aspiring Home Buyers Profile from the National Association of Realtors (NAR) found that the American public is still somewhat confused about what is required to qualify for a home mortgage loan in today’s housing market. The results of the survey show that non-homeowners cite the main reason for not currently owning a home, as not being able to afford one.


This brings us to two major misconceptions that we want to address today.


1. Down Payment


NAR’s survey revealed that consumers overestimate the down payment funds needed to qualify for a home loan. According to the report, 39% of non-homeowners say they believe they need more than 20% for a down payment on a home purchase. In actuality, there are many loans written with a down payment of 3% or less.


Many renters may actually be able to enter the housing market sooner than they ever imagined with new programs that have emerged allowing less cash out of pocket.


2. FICO® Scores


An Ipson survey revealed that 62% of respondents believe they need excellent credit to buy a home, with 43% thinking a “good credit score” is over 780. In actuality, the average FICO® scores of approved conventional and FHA mortgages are much lower.


The average conventional loan closed in August had a credit score of 752, while FHA mortgages closed with a score of 683. The average across all loans closed in August was 724. The chart below shows the distribution of FICO® Scores for all loans approved in August.


No… You Do Not Need 20% Down to Buy NOW! | MyKCM


Bottom Line


If you are a prospective buyer who is ‘ready’ and ‘willing’ to act now, but are not sure if you are ‘able’ to, let’s sit down to help you understand your true options.


REMAX Action Realty
Linda Dale
1126 Horsham Road
Maple Glen, PA 19002
215-646-3954
215-327-9759

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The data relating to real estate for sale on this website appears in part through the BRIGHT Internet Data Exchange program, a voluntary cooperative exchange of property listing data between licensed real estate brokerage firms in which REMAX Action Realty participates, and is provided by BRIGHT through a licensing agreement. The information provided by this website is for the personal, non-commercial use of consumers and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Some properties which appear for sale on this website may no longer be available because they are under contract, have Closed or are no longer being offered for sale. © 2019 BRIGHT, All Rights Reserved Information Deemed Reliable But Not Guaranteed. Data last updated: January 23, 2019 12 PM.
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