5 Common Misconceptions About Buying Real Estate
Common misconceptions about buying or selling real estate
If you are thinking of buying a house or apartment in Brickell, the popular misconceptions about real estate make you hesitate to do it, do not let the “popular wisdom” stop you, there is not as much truth as you think. Remember that: “A repeated lie becomes true.”
Misconception #1: You do not need a real estate agent to buy a house now that all the information is online.
Nowadays it is more important than ever to have a good local real estate agent in your team, and it will not cost you anything.
Buying a house is a rare and very important transaction in your life to go blind, you need someone who knows the market, understands the process and can act as an advisor to help you interpret the data and the legal process.
Buying a house is not just a financial transaction. It is incredibly emotional, and you will want a teammate to help spread the feelings, navigate the ups and downs, and lead in the right direction.
Misconception #2: You need a 20 percent down payment to buy a condo.
This is the biggest limitation for Millennials, who are often burdened with huge student loans, but still want to own a house or apartment. But there are other options.
After the credit and housing crisis, it became very difficult to get a mortgage. The lenders were strict, and the financing killed negotiation after negotiation. Today, however, it is possible to obtain a loan with as little as three or five percent down payment even when purchasing a condo. Although loan standards have loosened, it is not that easy. You must have a good credit history, verifiable income and assets to support. There are also other government aids to facilitate your purchase.
Here is a list of Brickell buildings that can be financed with as low as 5% down payment.
Misconception #3: The value of the property is what the appraiser says it is.
The market value of a home is determined by what buyers and sellers agree in an open market and in conditions of full competition.
A landlord or prospective seller can only rely on a recent evaluation of a bank when refinancing or the appraisal made by a professional appraiser that the vendor hires.
It is useful to understand that the appraised value of a house or apartment usually comes below the market value. Factors such as views, finishes, accessories or neighborhood specifications can affect the evaluation of your home.
Misconception #4: You need a 640 credit score to qualify for a home loan.
This used to be true many years ago, but with government loans into the market, lenders have lowered their credit score requirements for mortgages. While some mortgage loans, such as conventional loans, still require a 620-640 score. FHA loans are available to buyers with bad credit scores. In fact, FHA has the lowest credit score that requires any mortgage offered today. Credit scores as low as 500 can qualify for an FHA loan with a 10% down payment. However, having a credit score in the 500-579 range makes it very difficult to qualify even if you have 10% down. It’s recommended to working on increasing your credit score above 580 before applying. A 580 score is the minimum score some reputable mortgage lenders require for FHA. There are a lot more lenders look at than just your credit score. It would help if you had no more than a single late payment in the past 30 days: no judgments or liens, and minimal collection debt to qualify.
Misconception #5: It is not necessary to have “Open House” sessions to sell houses.
Many people believe that, with the arrival of online listings, “Open House” sessions are not necessary. Is not true.
The sessions of “Open House” are in the DNA of real estate, the more available you put your home to potential buyers, the better opportunities you have to sell it. Without an “Open House”, buyers may never set foot in the door of their property.
