Want to be smarter than the average mortgage borrower? Here are five common mortgage myths and the truth behind them. Read on, and you may gain an advantage when deciding what direction to take with your home financing.

Myth 1: You need a 20% down payment to buy a home

Historically, many homebuyers were required to make a 20% down payment to finance the purchase of a home. For a $250,000 property, that meant ponying up $50,000 in cash. Today, there are popular mortgage options that allow down payments as low as 10%, 3% or even 0% in some cases. Certain borrowers may also qualify for down payment assistance programs that can further reduce how much cash is needed for a purchase. These options make it possible for more people to become homeowners sooner or put their money to use elsewhere.

Myth 2: You must have excellent credit to get a mortgage

You don’t need a spotless credit history and sky-high credit scores to buy or refinance a home. There are numerous home financing options available for people with less-than-perfect credit. At Draper and Kramer Mortgage, we provide financing for borrowers with credit scores as low as 580, and we may have niche solutions or exceptions available for people with lower scores. You may also be able to get a mortgage as soon as one day after a foreclosure, short sale or bankruptcy.

Myth 3: The mortgage rate you see advertised is the one you can get

Everyone loves getting a good deal, but comparison shopping for mortgages is tricky. Most companies who advertise their mortgage rates only show the rates that are available for “best case” situations. These typically assume the borrower has high credit scores, low debt and a large down payment and is financing an owner-occupied single-family home. Speaking with your lender to get a personalized quote is the best way to find out what rates are available to you.

Myth 4: The mortgage rate you get is the one you’re stuck with

Mortgage rates have risen in 2022, leaving some homebuyers and homeowners feeling like they’ve missed out on the opportunity to snag a record-low mortgage rate. However, just because you have a 30-year loan doesn’t mean you’re destined to pay the same interest rate and monthly payment for 30 years. If mortgage rates drop again later, you may be able to refinance your mortgage to a lower rate and payment* if you qualify. And instead of getting a fixed-rate mortgage in the first place, you may wish to consider an adjustable-rate mortgage (ARM), which may offer a lower initial rate follow by an adjusting rate that could drop if market rates go down.

Myth 5: You should always pay off your mortgage as soon as possible

Many people look forward to the day they pay off their homes and say goodbye to their mortgage payments. However, it doesn’t always make financial sense to pay off your mortgage early. Since home loans typically have low interest rates, homeowners may gain more benefit by using their extra funds to pay off higher-interest debt (e.g., credit card balances) or contribute to high-return investments (e.g., stocks and mutual funds) rather than paying off their mortgages early.


Never assume that the home financing you need is out of your reach. Your options may be more accessible, flexible and affordable than you think. Get in touch for your free quote, consultation or preapproval to learn what financing is available to you.