Key takeaways
- You don't need a huge down payment; several programs are built for buyers with little or nothing down.
- Perfect credit isn't required; FHA and VA loans are built for flexibility.
- Lenders look at your debt-to-income ratio, not your debt alone.
- Self-employed and ITIN borrowers have real options through non-QM programs.
Buying a home can feel overwhelming, and misinformation makes it worse. Many people who could qualify for a mortgage never apply because of something they heard years ago. Here are the most common myths and the truth behind each one.
Myth #1: "I can't afford to buy a home."
Buying has become more challenging, but more people can afford it than they realize. Low- and no-down-payment programs, down payment assistance, and flexible credit guidelines open the door for many buyers. The only way to know is to run your numbers with a professional.
Myth #2: "I need a huge down payment."
That rule is decades out of date. VA and USDA loans offer no-down-payment options, and FHA and several conventional programs are built for buyers with a small down payment. With a smaller down payment on a conventional loan you'll usually pay mortgage insurance, which can be removed later. See all your low-down-payment options.
Myth #3: "My credit has to be perfect."
Good credit helps you get better pricing, but it's not a requirement. FHA and VA loans are designed with flexible credit guidelines, and some non-QM programs work with borrowers who've had a recent credit event.
Myth #4: "I have debt, so I won't qualify."
Almost everyone has some debt: a car, student loans, credit cards. Lenders don't look at debt alone. They look at your debt-to-income ratio (DTI), which compares your monthly debt payments to your monthly income. Many borrowers with debt qualify comfortably.
Myth #5: "I'm self-employed or don't have a Social Security number, so I can't get a mortgage."
Self-employed borrowers can qualify with bank statement loans and other non-QM options. Borrowers with an Individual Taxpayer Identification Number (ITIN) can qualify through ITIN loan programs.
The bottom line
Don't let outdated beliefs keep you from homeownership. A short conversation can tell you exactly where you stand and what it would take to get there.
Frequently asked questions
Do you really need a big down payment to buy a house?
No. VA and USDA loans offer no-down-payment options for eligible borrowers, and FHA and several conventional programs are designed for buyers with a small down payment. Ask us for the exact requirements for your situation.
What credit score do I need to buy a house?
FHA guidelines allow credit scores as low as 500 in some cases, and many VA lenders work with scores in the 580–620 range. Conventional loans typically require 620 or higher.
Can I get a mortgage with an ITIN instead of a Social Security number?
Yes. ITIN loan programs allow borrowers with an Individual Taxpayer Identification Number to qualify for a home loan, typically with a larger down payment than conventional loans.
Have questions about your situation?
Talk with a licensed loan originator. We'll walk you through your options in plain language.
Apply NowCall 855-724-5626This article is for general educational purposes and is not a commitment to lend. Loan programs, guidelines, and eligibility vary by lender and are subject to change. Contact us for advice on your specific situation.