Mortgage Myths Most People Get Wrong

Buying a home is one of the biggest financial decisions you’ll ever make — and yet some of the most common beliefs about the process are flat-out wrong. If you’ve been holding off on homeownership because of something you heard, read, or assumed, this one’s for you.

Here are five mortgage myths we hear all the time, and the truth behind each one.

Myth #1: You need a 20% down payment.

This is probably the most persistent myth in homebuying — and it stops a lot of people before they even get started.

The truth? Most buyers put down far less. FHA loans start at 3.5% down. At SNMC, we offer exclusive programs like SNclose™, which provides down payment and closing cost assistance, and SNhome™, which offers a forgivable second lien option for qualifying borrowers. Some programs go as low as 0% down depending on eligibility.

The 20% rule has its roots in avoiding private mortgage insurance — not in what’s actually required to buy. Don’t let a number someone made up decades ago keep you from exploring your options today.

Myth #2: You need perfect credit.

Credit scores matter, but they’re not the whole story — and they’re certainly not a gate that only lets perfect borrowers through.

Scores in the 580–620 range can still qualify for certain loan types. SNMC offers Non-QM loan options with flexible documentation and credit requirements, designed specifically for borrowers who don’t fit the conventional mold. Self-employed? Recovering from a rough financial patch? There may be more paths forward than you think.

Lenders look at the full picture — income, debt, employment history, assets — not just a three-digit number.

Myth #3: Renting is always cheaper than buying.

On the surface, this one seems logical. But the math is more complicated than a monthly payment comparison.

When you rent, your payment covers a roof over your head — and that’s it. When you own, your payment builds equity, stabilizes your housing cost against rent increases, and gives you a stake in an asset that historically appreciates over time. The average homeowner’s net worth is 43 times higher than the average renter’s, according to the Federal Reserve.

That doesn’t mean buying is always the right move for everyone right now. But the idea that renting is automatically the financially savvy choice deserves a closer look. The numbers tell a more nuanced story.

Myth #4: You have to be debt-free before you can buy.

Life comes with debt — student loans, car payments, credit cards. If you’ve been waiting to eliminate all of it before buying a home, you could be waiting a very long time.

What lenders actually evaluate is your debt-to-income ratio (DTI) — how much of your monthly income goes toward debt payments. Carrying debt doesn’t disqualify you. Carrying too much relative to your income can create challenges, but that’s a calculation worth running, not an assumption worth making. Many of our borrowers close on homes while actively paying down other debt.

Myth #5: The process is too complicated.

We hear this one a lot, and we get it. Mortgages have a reputation for being overwhelming — the paperwork, the terminology, the timelines.

But that’s exactly what we’re here for. Our job is to walk you through every step, explain what matters, and make the process feel manageable. SNapp Home lets you start your application from your phone in minutes. And every SNMC loan officer is there to answer questions, run scenarios, and help you understand your options before you commit to anything.

The process only feels complicated until you have someone in your corner who knows it inside and out.

The bottom line:

Homeownership is within reach for more people than these myths would have you believe. Don’t let bad information make the decision for you.

To learn more, find a loan officer near you!