Buying your first home is a milestone, but myths first-time homebuyers believe can make the process feel overwhelming. At Joint Path Mortgage, we’ve helped countless first-time buyers in [Your City/State] navigate the homebuying journey, separating fact from fiction. In this 2025 guide, we debunk five common misconceptions that could hold you back from homeownership. From down payments to credit scores, we’re here to empower you with clear, expert advice.
Myth 1: You Need a 20% Down Payment to Buy a Home
One of the biggest myths first-time homebuyers believe is that a 20% down payment is required to secure a mortgage. This misconception can make homeownership seem unattainable, especially for those early in their financial journey.
The Truth
Many loan programs offer far lower down payments, making homeownership more accessible:
- FHA Loans: Require as little as 3.5% down for borrowers with a credit score of 580 or higher.
- VA Loans: Offer 0% down for eligible veterans and active-duty service members.
- Fannie Mae HomeReady and Freddie Mac Home Possible: Designed for low-to-moderate-income buyers, these allow 3% down and accept income from non-borrowers (e.g., parents).
Additionally, down payment assistance programs through state and local governments can cover part or all of your down payment, with thousands of options available nationwide.
What to Do
Don’t let the 20% myth stop you. For a $300,000 home, a 3% down payment is just $9,000—far less than $60,000. Contact Joint Path Mortgage to explore options like HomeReady or local assistance programs. We’ll assess your finances and match you with the best loan, explaining costs like private mortgage insurance (PMI) upfront.
Myth 2: You Can’t Qualify for a Mortgage with Bad Credit
Many first-time homebuyers assume a credit score below 700 is “bad credit” and disqualifies them from a mortgage. This myth can keep you renting instead of building wealth through homeownership.
The Truth
You don’t need a perfect credit score to buy a home. Several loan options cater to lower scores:
- FHA Loans: Accept scores as low as 580 with 3.5% down or 500 with 10% down, forgiving past credit issues if you’ve improved recently.
- VA Loans: Often have no minimum credit score for eligible veterans, though lenders may prefer 620.
- Non-Qualified Mortgage (Non-QM) Loans: Ideal for self-employed buyers or those recovering from financial setbacks.
Many borrowers with scores below 700 successfully buy homes, especially with a strong debt-to-income (DTI) ratio.
What to Do
Check your credit score through your bank or credit card provider. If it’s below 700, focus on paying down debt and avoiding new credit inquiries. Then, consult Joint Path Mortgage to explore FHA or non-QM loans. We’ll review your credit and suggest ways to qualify now or boost your score for better rates.
Myth 3: Pre-Approval Isn’t Necessary Before House Hunting
Among the myths first-time homebuyers believe, one is that pre-approval is optional and can be skipped until they find their dream home. This misconception can cost you in a competitive market.
The Truth
Pre-approval is a game-changer. A pre-approval letter shows sellers you’re a qualified buyer, making your offer stand out. In competitive markets like [Your City/State], pre-approved buyers often win, as seen in a recent sale we facilitated where a pre-approved client’s offer was chosen over higher bids without pre-approval.
Pre-approval also clarifies your budget, preventing you from chasing unaffordable homes. It involves a lender reviewing your income, credit, and assets for a conditional loan commitment.
What to Do
Get pre-approved before house hunting—it’s quick and often free. Contact Joint Path Mortgage for a no-obligation pre-approval. We’ll provide a pre-approval letter and guide you to make strong offers. Don’t risk losing your dream home—be ready to act fast.
Myth 4: Renting Is Always Cheaper Than Buying
With rents rising in [Your City/State], many first-time homebuyers assume renting is more affordable. This myth traps some in a cycle of paying someone else’s mortgage.
The Truth
Buying can be cheaper than renting, especially long-term. Mortgage payments build equity, unlike rent, and may include tax benefits like interest deductions. In many U.S. markets, monthly mortgage payments are comparable to or lower than rent, especially with programs like HomeReady Loan that reduce upfront costs.
What to Do
Compare renting vs. buying with Joint Path Mortgage’s Mortgage Coach analysis. We’ll create a personalized report comparing costs, equity growth, and tax benefits for options like FHA or Home Possible loans. Book a free consultation to see if buying saves you money.
Myth 5: You Should Always Choose the Lowest Interest Rate
First-time homebuyers often focus solely on the lowest interest rate, assuming it’s the best deal. This myth can lead to costly oversights.
The Truth
The lowest rate isn’t always the best loan. Low-rate loans may have higher closing costs or terms that don’t fit your goals. Key factors to consider include:
- Closing Costs: Fees like origination and appraisals can add thousands.
- Loan Term: 15-year loans have lower rates but higher monthly payments.
- PMI: Low-down-payment loans like HomeReady may require PMI, affecting costs.
- Timeline: Most homeowners stay 7–10 years or refinance within 5–7 years.
For example, a 30-year loan at 6.5% with $5,000 in fees may beat a 6.2% loan with $10,000 in fees for short-term owners.
What to Do
Compare loan options with Joint Path Mortgage. We’ll break down rates, fees, and terms for loans like FHA or HomeOne, tailored to your plans. Contact us for a free loan comparison to find the best mortgage for you.
Why Choose Joint Path Mortgage?
Homebuying can feel daunting, but Joint Path Mortgage makes it simple. We specialize in guiding first-time homebuyers in [Your City/State] with personalized advice and transparent solutions. From low down payment loans to pre-approval, we’re with you every step.
Ready to debunk these myths? Contact us for a free consultation or download our “First-Time Homebuyer Guide” for tips on loans, assistance programs, and local trends.
Frequently Asked Questions
Can I buy a home with a low down payment?
Yes! Programs like HomeReady and VA Loans offer 3% or 0% down. Ask us about assistance programs in [Your City/State].
What if my credit score is below 700?
A score below 700 is fine. FHA Loans accept scores as low as 580, and we’ll find a loan that fits your profile.
Why does pre-approval matter?
Pre-approval strengthens your offer, showing sellers you’re ready. In [Your City/State], pre-approved buyers often win competitive bids.
Is buying cheaper than renting?
Often, yes. Our Mortgage Coach analysis compares costs, equity, and tax benefits for your situation.
How do I choose the right mortgage?
We compare rates, fees, and terms based on your goals and the average 7–10-year homeownership timeline.