Her First House™ Course Introduction and 11 Common Home Buying Myths

Her First House Course Introduction and Myths.pdf


Introduction

The rent cycle is hard to break and will likely keep a large percentage of American women trapped as renters…never enjoying the safety and security of home ownership. 

Created to appeal to aspiring home owners who are forward-looking, self-driven, and open minded; women who seek new horizons and take opportunities; doers who make things happen, Her First House™ makes it possible for smart renters like her to reach her true potential through a strategic Renter’s Home Buying Course tailored to prepare her for home ownership throughout her rental lease term.


The Problem

Traditional residential real estate brokerage isn't setup to serve renters.

Renters weren't ‘ready to buy’ and starter homes for first time home buyers produced small commissions for agents, which unfortunately meant they were not a priority. 


The Solution

We created the Her First House™ course so that renters and first time home buyers can quickly and easily prepare for home ownership prior to reaching out to an agent.


Common Myths

There are 11 common myths associated with home buying. Let's review them.

Myth #1

You need a perfect credit score to purchase a home.

It’s true that the higher your credit score, the better your interest rate will likely be, and the more you’ll save in the long run. While there are benefits to a perfect credit score, even if your credit is less than perfect, you could still qualify for a mortgage. Some mortgage loan products and buyer programs approve credit scores as low as 620 or even 580! It pays to shop around. The first step is to find out what your credit score is and then take the steps to improve it if needed.

Myth #2

A buyer must put down 20% to buy a house.

This is probably the most common and harmful home buying myth. It keeps renters in the rent race and stifles home ownership. Traditionally a buyer received a 30-year mortgage loan with 20% down. Oh have times changed. Today there are many mortgage loan options available to buyers based on their credit score and income. There are down payment options as low as 3% and down payment assistance programs available for buyers with low to moderate incomes.

Myth #3

The best time to buy is spring.

The best time to buy is when you are emotionally and financially ready to buy. Serious sellers and sellers who may be willing to negotiate, put their homes on the market when they need to sell. Put another way, homes listed during non-peak times could be listings of highly motivated sellers. Just focus on what you and your family’s needs are, such as getting settled in prior to the upcoming school year, taking advantage of a summer off, relocating for a job offer, or moving into your new home just in time to have your first Christmas as a family.

Houses sell all year long. Buyers buy houses all year long. 

If you choose a neighborhood where you want to live and a home that’s attractive and structurally sound, then you probably won’t go wrong. The home only needs to fit one family – yours, no matter when you buy.

Myth #4

Renting is better/cheaper than buying.

It completely depends on your circumstances and where you’re looking to buy. In some areas it can be less expensive to own a home. Many buyers buy because they want more peace, more security, more control, and more stability. Although you’ll need to account for ongoing expenses like maintenance, insurance and HOA dues (if applicable); luckily, there are tax deductions that can ease some of that burden. 

In some circumstances, renting is a far better option and can save you money in the long run. For example, if you're only going to live in a home for a year, it's most likely a smarter financial decision to rent vs buy.

Make a list of your pros and cons of buying versus renting to help put your “why” into perspective.

Myth #5

Having debt disqualifies you.

There’s no need to fret. Being in debt won't automatically prevent you from getting a mortgage. Your existing debts might be more of a speed bump than a roadblock on your path to homeownership. Lenders will look at your debt-to-income ratio, or DTI, to determine what percentage of your income is needed to cover all of your monthly debt obligations. The lower your DTI, the better your chances of qualifying for a mortgage. 

Poorly managed debt is more likely to cause roadblocks because it affects your credit score. And, it’s a bad idea to charge up balances on your cards right before you try to get a mortgage.

If your debt lowers your credit score or raises your DTI enough, it could lead to your mortgage application getting turned down. We’ll cover DTI in this course.

Myth #6

Shopping for a home is the first step in the home buying process.

There’s nothing wrong with window shopping and browsing to gain some inspiration. But before you start house hunting, you’ll need to know how much home you can afford. What you think you can afford and what a lender will approve you for can be two different numbers. Preparing for home buying is a critical step in the process that can’t be overlooked. 

Not preparing leads to wasted time, rejections, disappointment, and dead ends. Only after you know how much home you can afford and what you qualify for should you actually begin your hunt.

Myth #7

Working directly with a seller without a buyer’s agent will get you a better deal.

You don’t know what you don’t know. A real estate transaction needs a critical eye and knowledge of the paperwork requirements, general rules, and laws. It is the single largest investment most of us ever make. It requires an enormous amount of energy, effort and research. A buyer’s real estate agent can step in, initiate and track the buyer’s transaction, negotiate price and contract terms, and help uncover pitfalls of a particular house or the market in general based on prior experience and know-how.

Keep in mind the seller is going to pay the commission whether or not there’s a buyer’s agent. The listing agent will simply earn double the commission. There’s no savings to the seller or buyer when the buyer doesn’t have an agent. 

In 99.9% of real estate transactions, the buyer’s agent is provided at no cost to the buyer. 

Why would you choose to do it alone?

Myth #8

A loan buyer can’t compete with a cash buyer.

Cash is not always king. Cash buyers expect a discount because they’re typically offering cash and a quick close. Not all sellers are interested in giving discounts and will wait patiently for the right offer.

There are some things you can do to ensure your offer stacks up. For starters, your mortgage loan officer should be able to offer a quick close if they get you preapproved prior to putting in an offer. If you have all your financial ducks in a row, you may be able to shoot for a close in 2-3 weeks vs 30 to 45 days.

Secondly, many long-term homeowners like to know that there’s a real person and/or family behind the offer. When a seller is faced with two similar offers—one from a cash investor and the other from a person who really wants to become a member of the community and live in the house – and makes that known—a buyer with a solid offer and pre-approval may be selected over an all-cash investor.

In most cases, it is not in a seller’s best interest to discount the price of their house if it is priced fairly and in good condition.

Myth #9

Buyers should never offer full price.

Believe in this myth in a seller’s market and you’ll be disappointed as your offers get rejected. The market determines how hot, warm or cold your real estate bid or offer needs to be. In a seller’s market, many buyers offer over “asking price” to get the home they want.

Don’t let your dream house slip away. If you really want a particular house, you’ll want to present a strong offer leaving room to up the ante if your offer is countered or rejected. 

While a real estate agent wants to negotiate the best price for the house you want, they have other ways to save you money within the terms of the contract while still offering full price. 

An experienced agent knows how to position you as a buyer to get noticed. He/she also has an idea, based on market value, price, and condition, which houses should get a lower offer, a full price offer, or an over-bid. You won’t win them all, but you’ll have a much better success rate.

Myth #10

If you rent, you don’t pay property taxes.

When you rent, you help pay your landlords mortgage and property taxes. When you rent a home, your landlord factors in a number of expenses into your monthly rent like property taxes and maintenance costs. You might not be sending a check to the state government specifically for a tax payment, but your rent will be used to pay the owner’s property taxes.

Myth #11

Home maintenance is too expensive.

While maintenance and upkeep is a deterring factor for many home buyers, here’s the secret: home maintenance doesn’t have to be expensive. Many homeowners choose to purchase a home warranty to protect their budget against unexpected costs due to failures of their systems and appliances. And in many cases, a seller will include a warranty as part of the sale or transfer the existing warranty to the buyer. A home warranty will repair or replace a home's failed systems and appliances, which failed from normal wear and tear, for a small service call fee.

Renters Have Many Housing Options

As a renter, your housing options are wide open, but nothing beats owning a home. The benefits of home ownership are many…


☑ You get greater privacy

☑ You get more freedom to create the home you want

☑ It’s a good investment 

☑ You experience predictable and more stable housing costs

☑ You’ll enjoy pride in ownership 

☑ You’ll build strong community ties 

☑ You enjoy tax incentives and deductions 

☑ You build equity (a nest egg for the future)

☑ You build a strong credit history


Don't fall prey to myths. Don't let what you think you know about home buying derail your dreams of home ownership. 

In the end, when it comes to buying a home, the more prepared you are, the smoother—and less scary—the journey will be. 

Over the course of the next 18 months, we’ll prepare you for home ownership and get you on the right track to buying your first home.

Happy preparing!

See you in the 1st Course Track: Laying the Foundation

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