Buying a home can feel overwhelming, especially when it comes to understanding different mortgage options. From VA loans to FHA loans, USDA loans, and conventional loans, misinformation can easily steer buyers in the wrong direction. In this post, we’ll debunk 5 common home loan myths so you can confidently navigate the homebuying process and choose the loan that’s right for you — whether you’re a first-time homebuyer in Pensacola or a seasoned property owner.
Here’s Lindsay with a rundown of some common home loan myths.
1. VA Loans Take Forever to Close
The Myth: VA loans are slow, complicated, and take months to finalize.
The Truth: With an experienced lender, VA loans often close as fast—or faster—than conventional loans. I have seen some close in as little as 2 weeks. Plus, they offer zero down payment and no private mortgage insurance (PMI). For eligible veterans, active-duty service members, and surviving spouses, VA loans are one of the most powerful mortgage benefits available.
2. FHA Loans Are Only for First-Time Buyers
The Myth: FHA loans are a “first-time buyer program” you can only use once.
The Truth: FHA loans are available to any qualifying buyer. The main rule is that you haven’t owned a home within the last 3 years. They’re especially helpful if you have a lower credit score or need a smaller down payment, making homeownership more accessible to a wider range of buyers.
3. You Need 20% Down for a Conventional Loan
The Myth: You can’t qualify for a conventional loan without 20% down.
The Truth: Many conventional loans require as little as 3–5% down. While a larger down payment can lower your monthly payment and help you avoid PMI, it’s not mandatory. This flexibility allows more buyers to purchase a home sooner.
4. USDA Loans Are Only for Farms
The Myth: USDA loans are exclusively for agricultural properties.
The Truth: USDA loans are for qualifying rural and suburban areas—not just farmland. Many neighborhoods near Pensacola qualify, and these loans often require zero down payment. USDA loans are a great option for buyers looking to stretch their budget while getting into a home in a qualifying area.
5. Adjustable-Rate Mortgages (ARMs) Are Always Risky
The Myth: ARMs are too risky and should be avoided at all costs.
The Truth: Adjustable-rate mortgages can be a smart choice in certain scenarios. For example, investors with higher interest rates can use ARMs to optimize rental income and later refinance once the property is stabilized. ARMs can also save money if you plan to sell or refinance before the fixed-rate period ends, providing lower initial payments compared to fixed-rate mortgages.
Don’t Let Mortgage Myths Hold You Back
Believing common mortgage myths can keep you from finding the right home. There’s no one-size-fits-all loan — the best option depends on your unique circumstances. The right mortgage will be shaped by what you qualify for, the interest rate you can secure, the upfront costs you’re prepared to cover, the down payment you’re comfortable making, and which program best supports your long-term goals.
For Pensacola first-time home buyers, it’s especially important to work with a local team that understands the market, neighborhoods, and financing options available in our area. Whether you’re looking at FHA, VA, USDA, or conventional loans, the right guidance can make the process less intimidating and more rewarding.
π² Ready to start the conversation? Contact us today, and we’ll connect you with experienced lenders who specialize in helping Pensacola first-time buyers achieve homeownership. With the right support, your dream of owning a home in Pensacola can become a reality sooner than you think. Reach out to our sales team for more information on how we can help you navigate the steps to move to homeownership.
