If you’re thinking about getting a mortgage, maybe you view the situation favorably, or perhaps not so much. You should know that while it’s not necessarily ideal to get a mortgage, it’s not such a bad thing, either. Many individuals live with a mortgage for many years and find it’s the best way to occupy a house they could not otherwise afford. 

In this article, we’ll run through some myths and facts about mortgages you should know about if you’re thinking about becoming a homeowner in the near future. 

You Can Get a Mortgage for an Auction Property 

According to Clive Emson, you can get mortgage finance for an auction property that you buy. That comes as a surprise to many potential home buyers. However, it’s possible, if a little tricky. 

To secure mortgage financing for a house that you buy at auction, you will need to get preapproval. If you do not meet all of the requirements that a bank asks of you, though, this might not be a viable option. It’s at least worth looking into, though, even if you’re not exactly flush with cash at the moment. 

You Can’t Get a Mortgage with Student Loans or Any Other Kind of Debt 

There is a general sense you might have that if you’ve got debt, it is pointless to even attempt to get a mortgage. For instance, maybe you have heard that if you have credit card debt, student loans, etc., you should stick with renting. 

While it’s true that a great deal of debt can sometimes be an impediment to you getting a mortgage, it’s not true 100% of the time. Every situation is different. Meeting with a loan officer and getting them to look at your situation can’t hurt. The worst thing they can say is no.   

A 30-Year Fixed Rate Mortgage is Always Your Best Move 

A 30-year fixed-rate mortgage is one of the more popular kinds. However, it’s not necessarily the best choice every time. 

You may opt for a 15-year mortgage instead. This is advisable in some situations where you’re able to put more down upfront. If you also have a steady job that pays quite well, and there’s no reason to think you will lose it anytime soon, a 15-year mortgage might also be advisable.

You Need a Minimum of 20% Down to Purchase a Home 

It’s great if you have at least 20% that you can put down when you buy a home. It’s not a rule written in stone that you can only get a mortgage if you have that much, though. 

There are many situations where you can get a mortgage and be considered a serious buyer if you have less money to put down than 20%. This is a scenario where you will want to talk to a realtor, as well as loan officers or brokers who could potentially grant you the mortgage.

You Should Not Pay Your Mortgage Off Early 

You may have also heard that it’s a bad idea or even that it’s impossible to pay your mortgage off early. That’s seldom the case. 

It’s true that if you pay your mortgage off early, you might lose some of the tax benefits associated with having one. You can’t deduct the mortgage interest if you pay off the mortgage all at once, which may increase your taxable income. 

You may also have reduced liquidity if you go this route. This does not necessarily mean it’s a bad thing to do, though. Talking to a financial advisor if you are thinking about taking this step is a sensible idea.

Preapproval from a Bank Means You Will Get a Home Loan 

If you get preapproval from a bank for the money for a mortgage loan, you may feel like jumping for joy. This can potentially be a step that gets you closer to occupying your dream home. 

That being said, preapproval from a bank does not necessarily mean you will get the house you want. There may be a deal that another would-be buyer makes that strikes the seller as being more attractive. 

Also, keep in mind that preapproval from a bank for a mortgage loan typically only applies to one particular property. You will likely have to go through the entire approval process again if you miss out on a property you’ve had your eye on and must start looking elsewhere.

A Low Credit Score Always Means You Can’t Get a Mortgage 

If you have a lower credit score, that can make your life a little more difficult in some ways. You should not view it as being the sole factor that goes into the consideration by a loan officer or mortgage broker of whether to grant you a mortgage, though. 

For instance, if you can demonstrate that you have a steady job that pays well, it can help your chances of getting a mortgage. If your family has two sources of income instead of one, that can make a difference as well.   

If you can put a larger chunk of money down when you make an offer on a home, that can make a lower credit score less of a factor as well. Don’t assume if you have a middling credit score that it will automatically sink your chances of getting a mortgage.

A Down Payment Covers Your Closing Costs 

As you secure the money for a mortgage and attempt to move forward with the purchase of a home, you should always be aware of the closing costs that will come into play. These might include the costs of getting a home inspection, the cost of looking into the home’s ownership to see whether there are any current liens against it, and more. 

The first mortgage down payment that you make does not generally cover such costs, and you had better have the ready cash in reserve to cover them. Closing costs are typically multiple thousands of dollars, so make sure you have that money standing by.