Fact or Fiction?
This month we’ve been looking at a few real estate myths that sometimes confuse homebuyers and sellers in Fremont County. The first installment reviewed home pricing myths and the second post related to selling a home.
This third article shifts the focus back to a couple of myths related to buying a home. The fourth and fifth real estate myths in the series address commonly held misconceptions about agent fees and the amount of money you need to put down on a home.
Let’s get started!
The more you pay for a house, the more an agent makes…
This myth has some truth to it in that a Realtor will obviously make a higher commission on a $500,000 home than on a $100,000 home. However, the misunderstanding occurs when home prices are close. For example, the difference in your Realtor’s commission on a $300,000 home and a $310,000 home is roughly $150. If your Realtor suggests a slightly more expensive home, it isn’t in order to earn a bigger commission – it’s because they truly feel that home is a better fit for you!
A related myth is that we, as Realtors, make money hand over fist. While some agents make a very comfortable living, the average annual salary for a real estate agent is less than $40,000 per year. Once MLS fees, office fees, dues, and other overheads are taken out, the net income is much less.
I need 20% down to buy a home…
This is definitely not the case! Although it is a good idea to put money down on a home, you might have 100% financing options with different loan programs. You may qualify for a Federal Housing Administration (FHA) loan at 3.5% payment, or even a conventional loan at 5% payment. If you’re a veteran of the armed services, no-money-down loans may be available through Veterans Affairs or the Navy Federal Credit Union. A Rural Development loan through the Department of Agriculture is also a popular no-money-down option.
With any loan, your credit, level of debt, and income will factor into the type of loan for which you may qualify. If you aren’t sure what kind of loan you might be able to get, or don’t know what lenders to approach about a home loan, feel free to give us a call for a referral to a reputable lender.
Whether you’re buying or selling a home, Wind River Realty is here to help you along the way! We are happy to answer any and all questions, whether it’s related to financing, the state of the local real estate market, or any other details related to real estate transactions. Stop by our office at 309 North Broadway in Riverton, or call us at 856-3999 to get your questions answered!