Don’t Get Spooked by Mortgage Myths
The season of spooky stories is here, but not all the scary tales are about haunted houses and things that go bump in the night. Some of the biggest frights come from mortgage myths that keep buyers up at night and on the sidelines longer than they should be.
We know how important it is to separate fact from fiction. We dedicate a large chunk of our time every week to just putting the right information out there. Now, we’re shining some light on the most common mortgage myths that might be haunting you.
Myth #1: VA, FHA, or USDA loans take longer to close.
Not with RMN.
Some lenders may say government-backed loans are slow and complicated. In reality, these programs can close just as quickly as conventional loans, especially with a lender who knows them inside and out.
We have a huge advantage: our own in-house underwriter. While other lenders may be waiting days for a response from underwriters states away, we simply walk down the hall. Combine that with our strong pre-approval process (where much of the work is done upfront) and you’ll see why we consistently close loans on time, and sometimes even early.
So don’t be afraid of these loan options!
Myth #2: Government loans aren’t worth it.
VA, FHA, and USDA loans were designed to make homeownership more accessible. In fact, when our owner opened the doors in 1987, it was with the idea that these programs were not being offered locally and should be. We have been experts and champions of these programs since the beginning!
The VA loan is a benefit our veterans have earned through service. With no down payment and no PMI, it’s one of the strongest loan programs in the country. We can also offer the $5,000 Grant through the Iowa Finance Authority to pair with your VA loan!
The FHA program can be more lenient with credit scores and help low-to-moderate income earners get into their first homes— but that doesn’t mean that high credit score borrowers or higher income earners shouldn’t do an FHA loan. Sometimes, it is clearly the best option for someone of any credit or income level because it simply makes their overall monthly payment lower than if they did a Conventional loan.
USDA Rural Development loans provide 100% financing (zero down payment) for homes in eligible rural areas, opening the door for many families, in areas that are close to major hubs! In fact, RD loans can be used in popular counties like Johnson, Linn, Benton, Cedar, and Polk. Plus, the 2025 income limits have increased, which has expanded eligibility for many Iowa counties. This means more households now fall under the allowable income threshold, making it easier than ever to qualify.
These loans can be an amazing option to all types of people! That doesn’t sound scary to us!
Myth #3: You must put 20% down to buy a home.
A myth that’s as old as the mortgage industry itself!
While putting 20% down is an option, it’s not a requirement. Many buyers qualify for loans with as little as 0–3.5% down. There are also some programs that require no down payment, or offer programs to offset the down payment (such as the Iowa Finance Authority’s Down Payment Assistance). When you work with a local lender that also participates with IFA, you get all these benefits!
Waiting to save 20% could mean years stuck renting, while home prices creep higher. We’re here to help! Buying a home might be more attainable than you think, just come in and have a conversation with us.
Myth #4: PMI is terrifying—you should avoid it at all costs.
PMI isn’t the monster it’s made out to be.
Private Mortgage Insurance (PMI) helps buyers get into homes without a huge down payment. And despite its scary reputation, PMI usually isn’t that expensive, and it doesn’t last forever.
We always tell buyers to look at their overall monthly payment, if they can afford it, even with PMI, then there’s no reason to wait to save more money to put down and potentially miss out on building equity sooner. If it helps you buy your dream home now, why fear it?
Myth #5: Underwriters are out to “Trick” you.
No tricks here, only treats! Our underwriter isn’t hiding in the shadows. He’s right in our office, ready to make the process smoother and faster.
Because we gather documentation upfront, by the time a file reaches our underwriter, it’s typically a straightforward review. Our underwriter approves all loan types: VA, FHA, USDA, and Conventional, which is rare to find under one roof.
Other lenders may ship files across states and cross their fingers. We hand deliver them across the hall.
Our goal is simple: to close loans, not deny them.
Myth #6: You can only use a VA loan once.
Here’s the truth: Veterans and service members can use their VA loan benefit again and again, as long as entitlement is available.
You can even retain a home financed with your VA benefit and buy another primary residence using the VA loan product – as long as you qualify to own two homes at the same time.
Whether it’s your first home or your third, if you qualify, your VA loan benefit is still available to you.
You can buy and sell and buy again, however many times you want/need to with the VA loan program. There are some differences between a first time home buyer and a repeat buyer with the VA benefits, but our loan officers know the ins and outs of the program and can walk you through them.
So if you’ve heard you get “one shot,” don’t be discouraged, because it’s simply not true. If you want to talk through specific scenarios with us, we’re here to help and answer questions.
Don’t Let Mortgage Myths Haunt You
This spooky season, don’t let these mortgage myths keep you from your homeownership dreams. We know the ins and outs of every loan program, and our local, in-house process makes us uniquely equipped to guide you.
Ready to face your mortgage fears? Let’s get started!