First-Time Homebuyer Myths, Debunked: What You Really Need to Know

Myth vs. Fact: Debunking Common Homebuying Misconceptions

Buying a home is one of the biggest financial decisions you’ll ever make — but it’s also one of the most misunderstood. From outdated assumptions about credit scores to confusion around down payments, there’s no shortage of homebuying myths floating around. And unfortunately, they can hold future homeowners back from taking the next step.

At Davidson Homes, we believe the path to homeownership should be clear, informed, and empowering. That’s why we’re debunking some of the most common myths in 2025 — so you can move forward with confidence.

First Time Homebuyer Myths: You Don't Need 20% Down to Buy a Home

Fact: Many buyers qualify with as little as 3–5% down.

One of the most persistent homebuying myths is that you need a 20% down payment. While putting down 20% can help you avoid private mortgage insurance (PMI), it’s not a requirement—especially for first-time buyers.

According to the National Association of Realtors, the median down payment for first-time buyers in 2024 was just 9%. In fact, qualified buyers can often purchase a home with as little as 3% to 5% down, depending on the loan type.

Government-backed programs like FHA, VA, and USDA loans are designed to make homeownership more accessible. FHA loans typically require just 3.5% down, while VA and USDA loans may offer 0% down for eligible buyers.

If you’re working with Davidson Homes Mortgage, your dedicated mortgage loan professional will walk you through programs that match your financial situation. They’ll help you understand how much home you can afford—and ensure you’re set up with the right loan for your needs.

Myth #2: You need a perfect credit score to buy a home.

Fact: You can often qualify with a score in the 600s.

While a higher credit score can help you secure better rates, you don’t need a perfect score to buy a home. In fact, several loan programs are designed to support buyers with moderate credit.

• FHA loans typically require a score of 580 with a 3.5% down payment, or as low as 500 with 10% down.
• VA loans have no official minimum, but most lenders look for around 620.
• USDA loans usually require a score of 620 or higher, depending on the lender.
• Conventional loans often start at 620, though higher scores may offer better terms.

According to LendingTree, the average credit score for first-time buyers in 2024 was 709—a solid score, though there's still room to improve for the best rates.

If your score is lower, don’t panic. A mortgage lender can help you review your credit, offer improvement tips, and guide you toward programs that fit your situation. And once you're ready, Davidson Homes is here to help you find the right home for your goals—and your budget.

Myth #3: Renting is always cheaper than mortgage payments.

Fact: In many places, buying costs the same—or less—each month.

It’s easy to assume that renting is the more affordable option, especially with rising home prices. But when you factor in increasing rent costs and the long-term benefit of building equity, buying often makes more financial sense. Building home equity is a key advantage of homeownership, as it can boost your wealth and provide financial flexibility over time.

According to ATTOM’s early-2025 Rental Affordability Report, owning a home is now more affordable than renting in 52% to 60% of U.S. counties, including many areas where Davidson Homes builds. Even if the monthly costs are similar, owning a home means you’re investing in your future instead of someone else’s.

Not sure what you can afford? Start by browsing available move-in ready homes or speak with a sales consultant to explore your options.

Myth #4: You can’t buy a home if you have student loans.

Fact: Having student debt doesn’t automatically disqualify you.

Student loans are very common among new homebuyers—and the numbers confirm it. According to Yahoo Finance, 37% of first-time homebuyers have student loan debt, and many still successfully secure mortgages. What matters most is your debt-to-income ratio (DTI)—how much debt you have compared to your income.

If you have a steady income and manage your payments responsibly, there’s a good chance you can still qualify. A lender can help you understand how your student loans may impact your approval and what steps to take next. Some mortgage loans offer payment assistance programs, which can help with down payments or closing costs—making it easier to move forward with confidence.

Myth #5: You should wait for the “perfect time” or down payment to buy.

Fact: The best time to buy is when you are financially ready.

Trying to time the market—waiting for rates to drop or prices to change—can lead to missed opportunities. Life doesn’t always line up with the market, and the “perfect time” often never feels obvious until it’s passed.

Instead of chasing timing, focus on your own readiness. Do you have a stable income? A manageable debt load? A clear idea of what you’re looking for in a home? If so, you’re probably more ready than you think. Being financially ready means having enough money saved for your down payment, and understanding that the payment depends on your loan type and your personal financial situation.

Buying a home is a long-term investment—and with the right guidance, you can move forward with confidence no matter what the headlines say.

Your Next Step Starts Here

At Davidson Homes, we’re committed to guiding you through the homebuying process with clarity, care, and real support. Whether you’re just starting to explore or ready to take the leap, we’re here to help you navigate your journey every step of the way.

Start exploring homes in your area or connect with a sales consultant to learn more.