Myth #1: You need a 20% down payment
Fact: A 20% down payment hasn’t been required to buy a home for decades, if ever.
Many home loans allow a down payment as low as 3%, as long as you’re borrowing less than the so-called “conforming” loan limit for the county where the home you want to buy is located. (The limit for most counties is $832,750, as of 2026.)
Although down payments of less than 20% are common, keep in mind you will need to pay PMI (private mortgage insurance) on a conventional loan if you put down less than 20% of the home’s purchase price.
Myth #2: A bigger down payment is always better
Fact: While a larger down payment can reduce your monthly mortgage payment and potentially help you avoid private mortgage insurance (PMI), it is not always the best financial move. The ideal down payment depends on your personal situation and financial goals.
Putting down a larger sum of money can make your loan more attractive to a lender and lower your interest rate, but it can also deplete your savings. Homeownership comes with unexpected costs, from immediate repairs to furnishing your new space, so it’s critical to have a healthy emergency fund after closing. The smartest strategy is to find a balance between a down payment you are comfortable with and maintaining enough cash reserves to handle the inevitable expenses that come with buying and owning a home.
Myth #3: You should wait to buy a home until prices are lower
Fact: Residential property prices in the U.S. have only fallen four times over the last 80 years, according to Zillow Senior Economist Orphe Divounguy. A lot of factors would have to align in order for you to see a significant drop.
“House prices depend on non-housing and financial wealth, labor market conditions, and mortgage rates,” Divounguy said.
Because widespread declines in home prices have been so rare, if you’ve been interested in a particular home and you see its cost go down, it’s usually a great opportunity to “buy the dip,” as Divounguy puts it. But don’t expect all the homes in your area to see the same price change. If you do wait for that to happen, you could end up delaying your home-buying journey to save very little money, if any at all. If you find a home that feels like “the one,” talk to a lender or an agent — it may not be on the market for long.
Myth #4: You shouldn’t buy until you can afford your forever home
Fact: If you wait to buy until you can afford your forever home rather than buy a lower-cost starter home, you may never buy at all.
Or in the relatively more affordable markets where appreciation is still happening, you may miss out on years of equity building that could offset your selling costs when you trade up to your forever home.
Though there is a caveat: If you’re considering buying a home you already know that you’ll outgrow in the near future, it might make sense to wait until you find a home where you can stay for at least five or more years.
