Applying for a Mortgage? Don’t Believe These Common Misconceptions—Especially in This Market
The Lighter Side of Real Estate • May 11, 2022
There are a lot of misconceptions about what it takes to get a mortgage in this market, particularly with buyers new to the mortgage process—and buying into those misconceptions can cost you a lot of time, energy, and, in some cases, money.
So what, exactly, are the most common mortgage misconceptions?
A recent article from realtor.com outlined some misconceptions many buyers have about securing a mortgage in this market, including:
- Applying for a mortgage is a quick and painless process. Getting your mortgage approved can be a long, drawn-out, and tedious process that can add weeks (or even months!) to your home purchase—particularly in this market, when many lenders are processing a high volume of applications. Anticipate that the process may take a while—and, on your end, do your best to speed things up by being as organized and timely as possible with your lender’s requests.
- You’re guaranteed to secure a low interest rate. Many lenders are still advertising crazy-low interest rates—but securing a rate like that typically takes near-perfect credit and a sizeable down payment. When applying for a mortgage, make sure you have realistic expectations around interest—and don’t waste time looking at houses that are out of your price range based on the idea that you’ll get a low interest rate.
- You don’t have to pay anything out-of-pocket to get a mortgage. Most mortgages have a variety of upfront fees and costs (like closing costs)—so, if you’re applying for a mortgage, make sure you set cash aside to cover those out-of-pocket expenses.
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Should You Wait for Lower Rates? Mortgage rates have already dropped into the upper 5s twice this year. But after just a few days, they ticked back up into the low 6% range. If you saw that and thought, “Great. I missed it,” you’re not the only one. A lot of buyers are treating the 5s like some kind of magic number. As if moving from 6.1% to 5.99% suddenly changes everything. And from a mindset perspective, it does feel different. But here’s the part most people don’t actually run the math on. The Payment Difference Isn’t What You Think Let’s say you’re looking at a $500,000 home loan. At 6.1% , generally speaking, your principal and interest payment is roughly $3,030 per month. At 5.9%, it’s about $2,966 per month. That’s a difference of only $64 a month. Not $300. Not $500. Sixty dollars. Let that sink in for just a moment. Yes, over time that $64 a month can add up. But it’s far from the dramatic swing many buyers imagine when they say they’re “waiting for the 5s.” The psychological impact of seeing a 5 in front of your rate can feel big. The financial impact? It might be something you don’t even notice when it’s all said and done. Experts Aren’t Predicting a Big Drop Another important piece to think about: most housing economists aren’t forecasting a long-term return to 5% territory anytime soon. While rates will move up and down, likely hitting the high 5s here and there, the broader expectation is for mortgage rates to hover in the low 6% range this year, not stay in the 5’s or decline much more. While it certainly could happen, the reality is, waiting for a deep drop may not deliver the payoff you’re hoping for, if you’re holding out The Bigger Question to Ask Instead of asking, “Did I miss the 5s?” A better question is: “Does today’s payment work for me?” If the monthly payment fits comfortably in your budget, and you’ve found a home that meets your needs, the difference between 6.1% and 5.9% likely isn’t the deciding factor. It might be one of them, but it shouldn’t be everything. And remember, mortgage rates aren’t permanent. If they drop meaningfully later, refinancing is always an option. But you can’t refinance a home you didn’t buy. Waiting Might Feel Safe, But It Isn’t Always Strategic It’s natural to want the best possible rate. Everyone does. But sometimes buyers overestimate how much a rate in the high 5s will change things in today’s market. Don’t miss the fact that rates have already come down. A year ago, they were in the 7s. Now? They’re hovering in the low 6s. And for a lot of people, that percentage point difference that’s already here is the real game changer . If you paused your plans when rates were higher, now may be the right time to re-run your numbers. Not because rates are “perfect.” But because the monthly payment math might work better than you think, even with rates in the low 6s. Before assuming you’ve missed your moment, take another look at the numbers. You may find it never disappeared. Bottom Line If you’ve been sitting on the sidelines waiting for that magic number for rates, that strategy may not pay off as much as you’d expect. Let's connect so you can double check the math at your price point. You may realize payments are already within your range.
Spring Sellers Have an Edge. Here’s Why. Homeowners looking to sell usually want three things: plenty of interested buyers, strong offers, and a short timeline. Spring is the season that most often delivers all three. So, if a move has been on your mind this year, this is the window where momentum tends to work in your favor. Here’s what makes this season so powerful for sellers. 1. More Buyers Will Be Looking Typically speaking, in the housing market, there’s no more popular time to move than the Spring. Historically, data coming out of ShowingTime proves that’s when buyer activity peaks each year. Take a look for yourself (see graph below): And this year, there’s more than just the seasonal trend working in your favor. Mortgage rates are also sitting near 3-year lows – and that combination matters. More buyers + improving affordability = more eyes on your house . That doesn’t mean the market will return to the frenzy of the pandemic – far from it. But it does mean more buyers will be ready to re-enter the market. And that’s good for you. As Redfin says: “Homebuying demand is improving . . . and mortgage-purchase applications are sitting near their highest level in three years. . ." You should make sure your house is listed so you can take advantage of the uptick in demand. Because more activity means one thing: more opportunity to get a deal done. 2. You May Get More Offers With more buyer demand, it makes sense that you may get more offers on your house. And history shows that’s usually true. If we look at the data for the last three years from the National Association of Realtors (NAR), and take the averages for each month, it’s clear sellers in the Spring get more offers (see graph below): Now, don’t expect the excessive bidding wars that were so famous in 2020 and 2021. But it does mean, seasonality could help you out this Spring. As Realtor.com explains : “Spring typically brings out more buyers who are ready to make a move before summer. Listings see more views, showings, and offers during this season .” And that could be really good for your bottom line. 3. Homes Usually Sell Faster There’s one more predictable pattern that happens pretty much every Spring based on research from Realtor.com. Homes sell faster (see graph below): On average, homes sell 20 days faster in the Spring compared to the Winter. That’s almost 3 weeks shaved off your timeline. And that's a difference you can feel. Since homes have been taking longer to sell lately, listing your house during what’s usually the most active time of the year means you’re setting yourself up to move as quickly as possible. And isn’t that what sellers really want? The faster your home sells, the earlier you can move on to what’s next for you. If you’re eager to go on to your next chapter, need to downsize , or you’ve run out of space , Spring may be your best time to sell. Bottom Line Spring doesn’t guarantee a sale. Strategy still matters. But this season gives you something valuable: momentum. More buyers. More activity. More opportunity. The real question is: if you’re going to sell this year, why not do it when the odds are in your favor? Let’s talk about what selling this season could mean for your house and your timeline.
Are Home Prices Dropping? Here’s the Real Story. You’ve probably seen posts on social media talking about how “home prices are falling.” And when you see something like that, it’s normal to wonder: Is this the start of a crash? What does this mean for my house? Let’s clear this up right away. This is not a crash. And your home is not suddenly losing a lot of value. The National Story – Prices Are Still Going Up Here’s what often gets left out of what you’re seeing online. While some markets are experiencing slight declines, they’re the minority. Most places are still seeing prices rise or at the very least, hold steady. That’s why, at the national level, home prices are still rising, just at a slower pace. According to the National Association of Realtors (NAR): “Home prices continued to rise in the fourth quarter of 2025. National median prices rose 1.2% year over year to $414,900.” That’s not the rapid growth of a few years ago, but it’s not a downturn either. And just to really drive this home, here’s a look at the data from NAR at a regional level, so you can see that the negative narrative spun up online isn’t the whole truth (see graph below): Home prices are up (or at least holding steady) in the Northeast, Midwest, and South. The West has seen some small declines in certain markets, but “small” is the key word. There is no wave of falling prices across the country. Instead, there are just a few pockets adjusting after several years of what’s typically considered unsustainable or exponential growth. Yes, Some Markets Have Come Down, But Look at the Bigger Picture. Okay, but what about the places where prices have declined? According to ResiClub and Zillow, that’s not a cause for major concern. When you zoom out and look at those same markets over the past five years, the story changes (see graph below): In the areas with recent declines, home values are still significantly higher than they were just five years ago. That’s a direct reflection of how much home values have gone up. Online chatter tends to shine a spotlight on the few areas that are down. But the bigger picture shows most homeowners are still in a very strong position. Of course, every market, and every home, is different. But broadly speaking, home values are holding steady. And this isn’t a sign of widespread trouble in the market. Bottom Line Despite what you may be seeing online, home prices are rising or holding steady in most parts of the country. If you’re curious what your home is worth today, let’s take a look at the numbers together. Because context, and local expertise, matter more than what you’re seeing online.
