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Home Buyer Survey – Perception vs. Reality

Shocking Results From Home Buyer Survey

 In a recent home buyer survey conducted by Fannie Mae, a whopping 84% of respondents did not know what the minimum down payment is for a home loan. This is quite amazing when 43% of millennials state their number one concern on purchasing a home is overall affordability, followed by coming up with a down payment, per Digital Risk. How can there be such a HUGE information gap between consumers and lenders in todays world? A home loan is typically the largest financial instrument used by consumers, yet they know very little about them. Even with the help of Google, accessing this information is a challenge. Click here to see some of craziest things people searched for on Google.

Home Buyer Survey – Fannie Mae Study

In a recent study conducted by Fannie Mae, consumers were asked three questions specifically pertaining to Down Payment and were given seven multiple choice answers to choose from.

     21%+ Down         20% Down      11- 19% Down    6 – 10% Down      1 – 5% Down           0% Down            Don’t Know    


Question 1
Imagine that you are planning to purchase a new home. What is the minimum percentage of the home’s sale price or appraised value that you would feel comfortable paying as a down payment in order to proceed with applying for a mortgage loan?

Home Buyer Survey - Overall, less-educated and lower-income consumers, African-Americans, Hispanics, and current renters are more likely to say "Don't Know" across these down payment questions.

Overall, less-educated and lower-income consumers, African-Americans, Hispanics, and current renters are more likely to say “Don’t Know” across these down payment questions.

Question 2: Based on what you have heard, what is the percentage of a home’s sale price or appraised value that lenders expect borrowers pay as a down payment for a typical mortgage today?

Home Buyer Survey - Consumer perception is different from reality when it comes to mortgage requirements.

Fannie Mae asked consumers what a lender should expect to see for an average down payment.

 

Question 3: Regardless of what lenders expect, what do you think is the minimum down payment that lenders actually require?

Home Buyer Survey - 84% of survey responders did not no the minimum down payment required by lenders.

84% of consumers did not provide the correct answer which is between 1-5% Down.

 

 

How Do We Solve This?

CAN I BUY IT is determined to end the information gap between consumers and lenders. If you’re a Real Estate Broker, you can add our unique mortgage quoting software to your listing portal.  This will allow your visitors to quickly find out which financing options are available to them, along with the costs and requirements involved. As a loan program driven quoting engine, answers to common questions such as a minimum down payment and credit score requirements are instantly provided. 

Consumers in general can benefit by being more informed when it comes to home financing. It’s human nature to shy away from things we don’t fully understand.  In making this information more accessible, consumers may feel more comfortable taking the plunge into home ownership. It’s time to rethink the way real estate brokers and mortgage lenders communicate with prospective home buyers.

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For more information on why providing this information to consumers has been a difficult task, read this blog post. 

CanIBuyIt
CanIBuyIt is dedicated to informing homebuyers on their financing budgets.

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