Common Homebuying Myths Every Buyer Should Know 

The idea of getting a mortgage can feel overwhelming, and there are longstanding myths that can make home ownership seem harder to achieve than it really is. We hear various misconceptions often. That’s why we’re here to help bust the myths and set you on the path toward home ownership.  

The good news is that most myths simply aren’t true. Here are three of the biggest myths we’d like to clear up so you can feel more confident on your path to homeownership: 

Myth #1: You must have a 20% down payment 

While putting 20% down can help you avoid Private Mortgage Insurance (PMI), it is not required. 

Many buyers, particularly first-time home buyers, pay less than a 20% down payment. Thanks to PMI, lenders can offer loans with lower down payments. And because credit unions are member-focused institutions, they are often able to offer special, reduced rate PMI options that make monthly payments or one-time PMI premiums more affordable. 

There are also grants, downpayment assistance programs, and state or local initiatives designed to help homebuyers bridge the gap. A local Mortgage Loan Officer can help you explore programs that you could qualify for and show you how to combine them effectively. 

Myth #2: You need a high credit score to qualify 

While credit scores may affect the interest rate and loan terms offered, a high score is not a requirement for mortgage qualification. In fact, there are a wide variety of loan programs designed specifically to help buyers with moderate or minimal credit history. 

Local lenders with in-house, community-based underwriting also have the flexibility to consider non-traditional credit sources. If you don’t have a credit score at all, your lender may be able to build a credit profile based on consistent payment history, typically 12 months of payments such as: 

• Rent 

• Utility bills 

• Phone or internet bills 

• Monthly subscriptions, like Netflix 

Additionally, many financial institutions offer credit-building support and financial counseling to help you strengthen your credit over time. This means you can start where you are, get expert guidance, and work toward an even stronger financial position. 

Myth #3: You need a full two-year job history 

Employment history does matter, but the idea that you must have a full two years in the same job or field is not always accurate. 

For salaried or fixed hourly positions, lenders can often approve a mortgage with a much shorter employment history, if the income is stable. In some cases, even a signed offer letter for a new job is enough. The one-to-two year guideline becomes more important for: 

• Self-employed borrowers 

• Those with variable income, such as bonuses, overtime, shift differentials, or commissions 

For self-employment in particular, lenders typically look at taxable income, not gross revenue. This means that while deductions may reduce your tax burden, they can also reduce the income used for mortgage qualification. If you’re unsure how your income would be viewed, it’s always wise to have a local Mortgage Loan Officer review your situation. Most can even run an affordability analysis without a credit pull. 

Final Thoughts 

Homeownership is more accessible than many people think. If you have questions about down payments, credit, or income—or simply want to explore your options we encourage you to reach out to your local lender, or credit union, who can guide you every step of the way.