Buying your first home is one of the most exciting (and nerve-wracking) experiences you’ll ever have. But with all the outdated advice, internet rumours, and well-meaning opinions floating around, it can be hard to know what’s true, especially in today’s 2025 housing market.
Let’s clear up some common myths about buying your first home. This will help you feel more confident and prepared to own your first home.
Myth #1: You Need 20% Down to Buy a Home
Reality in 2025: Not true!
While putting 20% down can help you avoid private mortgage insurance (PMI), many first-time buyers qualify for loans with as little as 3% down or even zero down if you’re eligible for VA or USDA loans. Many lenders now offer flexible down payment assistance programs specifically designed to make buying more accessible.
Tip: Explore local and federal programs available to first-time buyers, and speak with a loan officer to understand your options. Here are some loan types with low down payment options:
- VA loans allow a 0% down payment. Sponsored by the Department of Veterans Affairs, VA Loans are open to veterans, reservists, active-duty personnel, and surviving spouses.
- USDA loans offer financing with no down payment. Organised by the U.S. Department of Agriculture as part of its Rural Development Guaranteed Housing Loan program.
- FHA loans allow a 3.5% down payment. Backed by the Federal Housing Administration. Drawbacks include a slower loan process and the need to pay mortgage insurance for FHA loans.
Myth #2: You Should Wait for Interest Rates to Drop
Reality in 2025: Timing the market is a gamble.
While interest rates have fluctuated over the past few years, waiting for the “perfect” rate could cost you more if home prices continue to rise. Additionally, rates can be refinanced later if they drop. But you can’t go back in time and get a lower home price.
Tip: If you’re financially ready now, focus on finding a home within your budget rather than trying to guess what the market will do next.
Myth #3: Your Credit Has to Be Perfect
Reality in 2025: Your credit doesn’t need to be flawless, but it matters.
A high credit score can help you get a better interest rate, but generally, conventional mortgages may require a minimum FICO score of 620. However, FHA (Federal Housing Administration) loans may accept lower credit scores starting at 580, which is popular among first-time homebuyers.
Tip: Check your credit early, correct any errors, and talk to a lender who can help you understand where you stand. Learn how to improve your credit score here.
Myth #4: You Can’t Buy With Student Loans
Reality in 2025: Student loans don’t automatically disqualify you.
Lenders look at your overall debt-to-income ratio (DTI) rather than just the presence of student loans. As long as your payments are manageable and your income supports your mortgage, having student debt isn’t a deal-breaker.
Tip: Keep other debts low and have a steady income to offset your student loan obligations.
Myth #5: Renting Is Always Cheaper Than Owning
Reality in 2025: Not necessarily.
With rising rent prices in many markets, owning a home can be a smart long-term investment. Monthly mortgage payments often remain steady (especially with a fixed-rate loan), while rents can increase annually. Plus, every payment builds equity in your future.
Tip: Compare the cost of renting vs. buying in your area, including tax breaks, maintenance, and equity building. Learn more about the pros and cons of renting vs. buying a home here.
Myth #6: You Don’t Need an Agent If You Use Zillow
Reality in 2025: Online listings are helpful, but not a substitute for an experienced agent.
A good buyer’s agent helps you find homes that match your needs, negotiates on your behalf, explains contracts, and protects your interests. And the best part? The seller typically pays their commission.
Tip: Interview a few agents and choose one who understands first-time buyers and your local market. Ask for referrals; recommendations from people you know with positive experiences, read reviews online, and check their track record.
When choosing a real estate agent, it’s important to consider these factors as this will help you make an informed choice and work with an agent best equipped, like Heidi and me, to help you achieve your goals.
Myth #7: Your Pre-Approval Rate is the Rate You’ll Get
Reality in 2025: Pre-approval gives you a helpful estimate, but the interest rate you’re quoted isn’t set in stone. Rates can change daily based on market trends, and your final rate won’t be locked in until you have a signed purchase contract on a specific property. Even then, rates can expire, so timing matters.
Tip: Ask your loan officer how long your rate lock will last, and review your options carefully once you’re under contract.
Myth #8: Buying a Fixer-Upper Will Save You Money
Reality in 2025: Fixer-uppers often come with major underlying issues, like outdated wiring, ageing plumbing, mould, foundation cracks, or even environmental hazards like asbestos, that aren’t always visible during a walk-through. Even the most thorough inspection can miss problems hidden behind walls or under floors.
Tip: Always get a detailed repair estimate and inspection contingency. Consider the time, effort, and surprise expenses before committing.
Myth #9: You Shouldn’t Buy Until You Can Afford Your “Forever” Home
Reality in 2025: Waiting to afford your “forever” home could mean missing out on years of equity growth and appreciation, especially in markets where home values continue to climb.
In today’s higher-rate environment, affordability is tighter, and many buyers are resetting expectations. But that doesn’t mean you’re making a bad financial decision by starting smaller. Starter homes are a stepping stone, not a setback. They allow you to build equity, establish credit, and gain valuable homeownership experience, all while protecting yourself from rising rents.
Tip: Aim for a home you can live in for 5–7 years, even if it’s not your dream. You can always trade up later.
Myth #10: A 30-Year Fixed Mortgage is Always the Best Choice
Reality in 2025: Adjustable-rate mortgages (ARMs) may offer lower starting rates, which can save you money depending on your plans.
In 2025, with interest rates still elevated compared to recent years, many buyers are exploring adjustable-rate mortgages (ARMs) as a more flexible, cost-saving alternative. ARMs typically offer a lower initial interest rate, which can mean lower monthly payments and significant savings in the early years of your loan.

Tip: If you plan to sell or refinance within 5-7 years, consider an ARM. Just understand how and when the rate adjusts.
Buying your first home in 2025 might seem overwhelming, but don’t let myths hold you back from achieving your goals. With the right knowledge, support, and strategy, you can make a confident move toward homeownership.
Have more questions? Reach out, We’d love to help you take the first step toward your dream home.