This is Only a Test

Explosion in the ocean in black and white.
Okay, it’s not really a test – it’s more like a quiz, but it doesn’t have the same verbal POW when you say, “This is only a quiz.” Do you feel me?  Yes, the photo above does depict an actual TEST of an explosive device, but I promise you that this quiz and its answers will blow your mind.  Too corny?  Sorry about that.  Moving on.
I’ll keep it short – just three questions.  Ready?  Here we go:
1. With a 580 FICO on an FHA loan, what is the minimum down payment requirement?
     a. 3.5%
     b. 15%
     c. 20%
     d. FHA loans require a 620 minimum FICO score
2. With a FICO over 700 on a Conventional loan, what’s the lowest minimum down payment?
     a. 1%
     b. 5%
     c. 10%
     d. 20%
3. According to the NAR’s latest data, the typical down payment for 60% of first-time home buyers is _____ or less?
     a. 6%
     b. 9%
     c. 12%
     d. 15%
The answer to all three questions is “a” – did I make it too obvious?  Seriously, though, most borrowers we meet are stunned (in a good way, of course) to learn that a 580 FICO may only require a 3.5% down payment.  Along those same lines, they’re equally stunned that a 700+ FICO opens up the possibility of only having to come up with a 1% down payment.  Lastly, far more than half of the potential buyers we help know that a 20% down payment is NOT the “normal” amount required in most transactions.  Since the 1980s, FHA has backed home loans with only a 5% down payment; since the 1990s, Conventional loans have had a similar minimum requirement.
If you got all three questions right, you’re probably already in a home of your own and/or you’re a real estate zen master – kudos to you on either or both fronts!  If you got two out of three correct, regardless of which one you missed, it means you could be leaving money on the table or you’re waiting longer than you need to get into a house.  If you only got one question correct – let’s be honest – that was probably just luck. 🙂  With that said, the difference between THINKING you know what’s required and KNOWING what’s required to get into a house can be worth A LOT of money and time you don’t need to spend.
You have to admit the results of this quiz are going to help you far more than the one you took last week on Facebook that helped you figure out which men’s romper would look best on you (or your boyfriend) – and the answer, obviously, is NOT A SINGLE ONE.

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