Tallahassee, FL (WTXL) -- When it comes to buying a new home, there can be quite a bit of confusion about mortgages and borrowing money.
WTXL ABC 27's Christine Souders sat down with local realtor, Rebekah Rivers, to help debunk a few mortgage myths for first time home buyers.
5 Mortgage Myths:
- Closing costs: new mortgage rules that took effect last fall, TILA-RESPA, are providing borrowers with a clearer picture of mortgage closing costs prior to settlement.
- Who can cover closing costs: borrowers may believe that they are the only ones who can pay their closing costs. However, closing costs can be offered as a seller concession.
- The credit-less: consumers who don't have credit cards may think their lack of debt history will be a positive when applying for a mortgage. However, lenders are looking for how well consumers manage their debt and a lack of history could be problematic in qualifying a borrower.
- Minimum requirements for qualifying: home buyers may be under the impression that their credit needs to be a lot more stellar to qualify for a mortgage than it actually needs to be. To qualify for a Fannie Mae-backed loan, borrowers only need a 3 percent down payment and minimum FICO score of 620.
- Eligible tax breaks: mortgage interest deductions are not limited to just primary residences. In some situations, second-home loans and home equity loans of credit may also be eligible.
