The five most common home-buying myths I hear are that you need 20 percent down, that renting is always cheaper, that you need perfect credit, that expenses stop after closing, and that you should wait for the perfect home. None of these hold up once you look at the actual numbers and process.
This blog is for general educational purposes only. It is not legal, tax, or financial advice. Loan program details and eligibility vary by lender and by borrower. Always consult a licensed lender or financial advisor for guidance specific to your situation.
Homeownership can feel confusing, intimidating, or out of reach, especially if you have never gone through the process before or if you are navigating it without family who bought a home before you. A lot of that feeling comes from myths that get repeated so often they start to sound like facts, whether from a well-meaning relative, an old article, or something half-remembered from a coworker’s story. Here are the ones I hear most often and what is actually true.
Do You Need a 20 Percent Down Payment to Buy a Home?
No. A 20 percent down payment can help you avoid private mortgage insurance, but plenty of lenders offer loan programs with down payments as low as 3 to 5 percent, and some programs allow even less depending on your eligibility. Down payment assistance programs can also help reduce what you need to bring to closing. I keep an updated list of down payment assistance options for Denver Metro buyers right here on my blog if you want to see what might apply to you.
Is Renting Actually Cheaper Than Buying?
It can feel that way month to month, but renting and buying build very different financial outcomes over time. According to the Federal Reserve’s Survey of Consumer Finances, the median net worth of homeowner households was roughly 38 times higher than that of renter households in the most recent data available. Part of that gap comes from equity. Each mortgage payment you make builds ownership in an asset, while a rent payment builds ownership in someone else’s. Rent payments also tend to increase year over year at the landlord’s discretion, while a fixed-rate mortgage payment on the loan itself stays the same for the life of the loan, even as your income grows over time. That does not mean buying is automatically the right move for everyone right now, but it does mean the “renting is always cheaper” myth leaves out a big part of the picture.
Do You Need Perfect Credit to Buy a Home?
No. Good credit gives you access to more loan programs and better rates, but there are loan options available for buyers who do not have a flawless credit history, including FHA loans that allow for lower minimum credit scores than a conventional loan typically requires. If your credit needs some work before you buy, that is not a reason to rule out homeownership. It is a reason to talk to a lender early so you know exactly what steps would move your options in the right direction, whether that means paying down a specific balance, correcting an error on your report, or simply waiting a few months for recent activity to age off.
Can You Negotiate on New Construction Homes?
Yes, though it often looks different than negotiating on a resale home. Builders may be less flexible on the base price itself, especially in a popular community, but there is frequently room to negotiate on upgrades, closing cost credits, or the interest rate through the builder’s preferred lender. Builders also tend to become more flexible toward the end of a quarter or when they are trying to move through remaining inventory in a completed phase. Having your own agent represent you in a new construction purchase, rather than relying solely on the builder’s on-site sales representative, is one of the most overlooked ways buyers leave negotiating room on the table.
Does Hiring a Buyer’s Agent Automatically Cost You Money Out of Pocket?
Not necessarily, though this myth has gotten more complicated since practice changes tied to the 2024 NAR settlement. Buyer’s agent compensation is now something you negotiate directly with your agent and document in a written agreement before touring homes, rather than something that is simply assumed to be built into every transaction. Depending on your specific offer, that compensation may be covered by the seller as part of the deal, or it may come from you directly. I cover this in more detail in a separate post on my blog if you want the full breakdown.
Are You Done With Expenses Once You Buy a Home?
Not even close. Homeownership is an ongoing responsibility, not a one-time transaction. Beyond your down payment and monthly mortgage payment, you will need to budget for property taxes, insurance, ongoing maintenance, and the occasional surprise repair that always seems to show up at an inconvenient time. A common rule of thumb is to set aside somewhere around one percent of your home’s value each year for maintenance and repairs, though the right number for you depends on your home’s age, systems, and condition. Planning for these costs from the start, rather than being caught off guard by them later, is one of the biggest differences between buyers who feel confident as homeowners and buyers who feel blindsided.
Should You Wait for the “Perfect” Home?
Waiting for a home that checks every single box can mean waiting far longer than necessary, and often, that perfect home does not actually exist. Most buyers end up making small updates or adjustments after moving in, even in a home they love. A more useful question than “is this perfect” is “does this home meet my real priorities, and can I see myself building a life here.” That question tends to get buyers into a home much faster, without sacrificing what actually matters to them. It also helps to remember that a home is not a static thing. Paint colors change, kitchens get updated, and landscaping matures. A home that is 80 percent right today, in a location and price range that works for you, is often a better long-term decision than an empty search for the one that is 100 percent right on paper.
Why Do These Myths Persist?
A lot of these myths come from outdated advice, secondhand stories, or general assumptions that were never quite accurate to begin with. Homebuying rules, loan programs, and market conditions change over time, so advice that was true five or ten years ago is not always true today. That is exactly why I encourage buyers to ask specific questions about their own situation instead of relying on general rules of thumb they picked up somewhere along the way.
Do You Have to Beat an All-Cash Offer to Win in a Competitive Market?
Not necessarily. All-cash offers can be appealing to sellers because they remove financing risk, but they are not the only thing that makes an offer competitive. A strong pre-approval, a clean and well-structured contract, flexibility on the closing timeline, and a well-written offer can all help a financed buyer compete, even against cash. Sellers are usually weighing certainty and terms as a whole, not just how the purchase is funded. Part of my job is helping you structure an offer that competes on the things you can actually control.
Do You Have to Use Your Agent’s Recommended Lender or Inspector?
No. You are free to choose any lender, inspector, or other professional you want during your transaction. If I recommend someone, it is because I have worked with them before and trust their work, not because you are required to use them. You should always feel comfortable interviewing more than one option and choosing whoever you feel most confident working with.
Is Every Myth on This List Equally True Everywhere?
Not exactly. National data and general loan program rules are a helpful starting point, but the details that affect you personally, like which specific down payment programs you qualify for or how competitive a specific Littleton neighborhood is right now, are local and situational. That is the gap between general homebuying advice and advice that actually applies to your search.
What Should You Do Next If One of These Myths Has Been Holding You Back?
If any of these myths has been the thing keeping you from starting your home search, that is worth a real conversation, not just more secondhand advice.
My Buyer’s Guide walks through the actual process, from down payment options through closing day, so you can replace these myths with a clear plan specific to you. You can download it here, call me directly at (303) 775-9669, or email me at maci@livelaughcolorado.com anytime, and we can talk through what is actually true for your specific situation.
Originally published on Live.Laugh.Colorado. Real Estate Group’s blog: Five Home Buying Myths
Maci Chance is a Littleton, Colorado Realtor® serving Littleton, Highlands Ranch, and the entire Denver Metro area, specializing in local homes, neighborhoods, and lifestyle-focused real estate guidance.
