Busting 2 Myths Preventing People From Getting a Mortgage

You don’t need to pay more than 20% down or have a FICO score 780 or more to get a loan. Here’s the truth about these myths.

Buying a home? Click here to perform a full home search

Selling a home? Click here for a FREE Home Price Evaluation

Today I want to address two common myths floating around out there that keep people ( especially millennials) from getting a mortgage.

Myth #1: You need to have more than 20% down.

I recently worked with young couple who wanted to buy a $500,000 condo. A 20% down payment on that $500,000 property would’ve cost $100,000, which for them would’ve been an exorbitant amount of money. That’s why I suggested they pay only 10% down. Paying less meant they’d have to pay the PMI (private mortgage insurance), but that payment would only be an additional $247 a month instead of the additional $50,000.

Ideally, paying 20% down would be awesome, but in some instances it might be better to talk to a lender and see if there’s a way you can come up with less money down and still get a house right away instead of paying a huge amount like $50,000.

The world of lending is more flexible than you think.

Myth #2: You need to have a FICO score of 780 or more.

Obviously, that’s a great credit score, but the fact of the matter is that 54% of all people typically have a score that’s less than that. There are many different loan programs out there, and any lender will probably be able to get you a loan if you have a score between 640 and 680. Just make sure you’re not in the 500s.

Whether you’re trying to buy a new home or buy your first home, don’t fall for these two myths. If you have any questions about this or any other real estate-related topic, feel free to reach out to me via phone or email. I’d be happy to help.

Is a Cash Offer Always Better Than a Financed Offer?

Cash offers are usually more appealing than financed offers, but as you’ll see today, there are other things to consider before you make a decision.

Buying a home? Click here to perform a full home search

Selling a home? Click here for a FREE Home Price Evaluation

Are cash offers always the best offers when it comes to selling your home?

I just recently had a client who faced this same question. They listed their home for sale and received two offers—one of them cash, one of them financed. The cash offer was about $10,000 less than asking price, but it didn’t require any contingencies or inspections. Furthermore, the buyer wanted to close quickly in 15 days. The financed offer, on the other hand, was at asking price, but that buyer wanted a multitude of inspections done and needed a larger closing period.

There’s more than meets the eye when it comes to cash offers.

In this instance, my seller went with the cash offer. In fact, they were happy to do so. The price was lower, but the quick closing period and the lack of inspections and closing costs were more than a fair tradeoff.

If your home is on the market and receiving multiple offers, though, should you always go with the cash offer? It depends. You have to consider other variables within the offer, like how fast it’s going to close and how many inspections it will require, and decided how important those variables are to you.

If you have any other real estate questions, please feel free to call, email, or text me. I look forward to helping you!

Is Zillow a Reliable Real Estate Resource?

Can you trust Zillow as a home search and home evaluation tool? Today, I'll explain why you need to be wary of both as a home buyer or seller.

Buying a home? Click here to perform a full home search

Selling a home? Click here for a FREE Home Price Evaluation

Can you trust Zillow as a reliable tool for a home search or home evaluation? In general, I'd say it's not very good for either.

Zillow's home evaluations come from the tax assessors, which is usually just general information regarding square footage and the number of rooms in a house, but it doesn't take into account things like upgrades, additions, or even the location of the house. What about the beautiful pictures on Zillow? Those are taken by the agent, not by Zillow.

You'll also notice there may be multiple agents listed next to the listing on Zillow. Why is this? Typically, the top agent is the home's actual listing agent while the others have just paid to be there. You have to be careful because these agents might not know the area, and they definitely don't know the house. Make sure you contact the home's listing agent for questions.

Unlike the MLS, Zillow isn't updated on a daily basis.

You also need to be careful with Zillow because listings aren't updated on a daily basis, so it's not as accurate as the true area MLS. You might see listings on Zillow that have sold, are pending, or are no longer active for this reason. If you want accurate information about a listing, it's better to contact a real estate professional who knows the area and the houses that you're looking for.

If you have any more questions or you're thinking about buying or selling a home in the Southern California market, give me a call or send me an email. I'd be happy to help!