I want to tell you about a conversation I have at least twice a week.
Someone reaches out — good job, solid income, been renting for years, finally ready to stop throwing money at a landlord — and within the first five minutes they say something like: "I figured I probably can't qualify yet. My credit score isn't at 700 and I don't have 20% saved."
And I have to stop them right there.
Because what they just described? That's not a barrier to buying a home. That's a myth they read somewhere on the internet and have been treating as fact ever since.
A survey published in May 2026 by Veterans United Home Loans confirms this is happening everywhere. Not just in my inbox. Researchers polled 400 people who plan to buy a home within the next three years, and the results were equal parts fascinating and frustrating. More than half of respondents described themselves as "very or extremely knowledgeable" about mortgages. And yet? Most of them were operating on information that is flat-out wrong.
Here in Spokane, Coeur d'Alene, Post Falls, and the rest of the Inland Northwest, this is costing people real opportunities. The market has shifted in ways that genuinely favor buyers right now. But only the buyers who actually show up get to take advantage of it.
Let's fix the information problem.
Myth #1: You Need a 700+ Credit Score to Qualify for a Mortgage
The survey found that 34% of prospective buyers believe they need a credit score of 700 or higher to qualify. Another 57% think they need at least 660.
Many programs have minimum credit score requirements that are lower than most people expect. FHA loans, one of the most popular programs for first-time buyers, have a published minimum credit score requirement of 580 for standard eligibility. VA loans, available to eligible veterans and service members, have no official government-set minimum credit score requirement. Conventional loans backed by Fannie Mae and Freddie Mac have also shifted to evaluate alternative credit data (things like rent payment history, utility bills, and phone payments) alongside credit scores.
Your credit score matters. A higher score typically opens more loan options and may qualify you for better terms, and I'm not going to pretend otherwise. But a score that isn't perfect does not automatically disqualify you. It means we look at your full financial story: your income stability, debt-to-income ratio, savings, and payment history. And we find the program that fits.
If you've written yourself off because of a number, please reach out before you make that decision permanent. You may be closer than you think.
Myth #2: You Need 20% Down
This one has been wrong for decades, and it still circulates like it's gospel.
The survey found that 15% of respondents believed a 20% down payment is required for a conventional mortgage. Nearly half (46%) believed they'd need more than 5%.
Here's how various loan programs actually work, based on published agency guidelines:
Conventional loans: Fannie Mae's HomeReady and Freddie Mac's Home Possible programs are specifically designed for eligible first-time and low-to-moderate-income buyers, with published minimum down payment requirements lower than 20%. All conventional loans are subject to credit approval and lender underwriting guidelines.
FHA loans: The Federal Housing Administration publishes a minimum down payment requirement of 3.5% for borrowers meeting the minimum credit score threshold. FHA loans require mortgage insurance premiums for the life of the loan in most cases, which is a factor worth discussing when comparing options.
VA loans: The VA home loan benefit for eligible veterans, active duty service members, and qualifying surviving spouses includes a published zero down payment option for those who meet eligibility requirements. There is no requirement for private mortgage insurance. In 2026, the standard VA conforming loan limit in Washington state is $806,500, with jumbo VA loan options available. Eligibility, entitlement, and loan terms are subject to VA guidelines and lender approval.
USDA loans: The USDA Rural Development program includes a published zero down payment option for properties in eligible rural and suburban areas. Property and borrower eligibility requirements apply.
Washington state buyers may also have access to additional assistance through third-party programs. These programs have their own eligibility requirements, income limits, availability, and terms that are separate from and independent of any mortgage I originate:
- The WSHFC Home Advantage Program, a state program offering down payment and closing cost assistance. Income limits, property requirements, and program availability apply. Contact WSHFC directly or visit wshfc.org for current details.
- The Covenant Homeownership Program, a state-administered program for eligible buyers. Eligibility and terms are set by the state.
- Community Frameworks HomeStarts, a local Spokane County resource for eligible buyers. Availability, eligibility, and funding are subject to program guidelines.
I can help you understand which of these programs you may want to explore, but these are third-party programs (not products I offer) and their terms are set by the administering agencies, not by me.
The 20% myth persists in part because there's a legitimate reason some buyers choose to put 20% down, as it eliminates private mortgage insurance on conventional loans. That's a real financial consideration worth discussing. But 20% down is a choice, not a requirement. The National Association of Realtors reports that first-time buyers have put down between 6–9% on average every year since 2018.
Myth #3: Mortgage Rates Are the Worst They've Ever Been
This one genuinely surprised me when I saw the survey results: 63% of respondents believe mortgage rates right now are the highest they have ever been in history.
They are not. Not even close.
For historical context: according to Freddie Mac's published Primary Mortgage Market Survey data, the all-time recorded peak for the 30-year fixed mortgage rate was 18.63% in October 1981. Rates remained above 10% for much of the late 1970s through the early 1990s. My parents bought their first home during that era. I genuinely don't know how they did it.
According to aggregated rate data published by Zillow, NerdWallet, and Bankrate as of late May 2026, 30-year fixed mortgage rates in Washington state have been ranging from approximately the mid-6% to upper-6% range depending on lender, loan type, loan amount, and individual borrower credit profile. These figures represent market averages from third-party sources and are not a quote, offer, or commitment to lend. Your actual rate will depend on your specific financial profile, loan type, term, and the lender you work with.
Are rates higher than the historic lows of 2020–2021? Yes. Are they the worst in history? No. And working with a mortgage broker who can shop multiple lenders (rather than going directly to a single bank) often means accessing options and rates that aren't available to the general public.
According to published forecasts from Redfin, Zillow, and Fannie Mae, rates are broadly expected to remain in the mid-6% range through 2026, with the possibility of modest movement in either direction. These are third-party forecasts, not guarantees.
Why Right Now Actually Matters for Spokane and CDA Buyers
While buyers have been frozen by myths, the market has been shifting in their direction. Here are the local numbers, sourced from published market data.
Spokane: According to multiple local and regional real estate market reports, the median home price in Spokane is currently in the $415,000–$439,000 range, up approximately 2–3% year-over-year. Active listings are up roughly 39% year-over-year, and months of supply sits near 3.8 months, moving toward balanced market conditions. More inventory means more options and, in many cases, more room for buyers to negotiate.
Coeur d'Alene: Redfin market data as of early 2026 shows a median sale price near $601,000, up approximately 4.6% year-over-year, with average days on market around 45 days and inventory at approximately 6.3 months of supply. That's a market where buyers are finding more time to make decisions and less pressure from competing offers than in recent years.
Post Falls: Redfin market data shows a median price near $536,000, up approximately 1.9% year-over-year.
Redfin has publicly characterized the 2026 housing market as "The Great Housing Reset," describing it as a period of gradual normalization. That's a national narrative, and the local data is consistent with it. More inventory and slower appreciation are generally buyer-friendly conditions. Market conditions change, and I don't have a crystal ball, but the current environment is meaningfully different from the frantic pace of 2021–2022.
What You Can Actually Do Right Now
- Get an actual pre-qualification conversation. Not a guess based on what you read online. Find out what you actually qualify for based on your real financial picture.
- Ask about down payment assistance programs. If you're buying in Washington state, programs exist that most buyers don't know about. I can point you toward the right resources and help you understand which might be worth exploring.
- If you're a veteran, look into your VA loan benefit. It was earned. If you haven't explored whether it applies to your situation, that's worth a conversation.
- Stop letting myths make the decision for you. The buyers finding opportunity in this market are the ones who got real information and made a decision based on their actual situation.
Ready to Find Out What's Actually Possible?
I'm Karin Herling, the Local Loan Lady, a lifelong Spokane resident, licensed mortgage broker (NMLS 2619893), and the person who will give you the real picture — not the scary internet version.
I'm licensed in Washington, Idaho, and California, and I work with buyers across Spokane, Coeur d'Alene, Post Falls, Colbert, Mead, and the broader Inland Northwest.
Let's have a conversation. Not a commitment, just a conversation about what your options actually look like. I promise it'll be more useful than another hour of Googling.
Reach out at localloanlady.com
Frequently Asked Questions
This content is provided for educational and informational purposes only and does not constitute financial, legal, or lending advice. It is not a commitment to lend, an offer of credit, or a guarantee of loan approval. All mortgage loans are subject to credit approval, underwriting guidelines, and lender terms and conditions. Not all applicants will qualify. Loan programs, rates, terms, and availability are subject to change without notice. Interest rate information referenced in this post reflects third-party market averages published by Zillow, Bankrate, and NerdWallet as of late May 2026 and is not a quote or offer from Karin Herling or any affiliated lender. Down payment assistance programs referenced are administered by third-party state agencies and nonprofit organizations; eligibility, availability, and terms are determined by those organizations and are independent of any mortgage originated by Karin Herling. VA loan eligibility is determined by the U.S. Department of Veterans Affairs. USDA loan eligibility is determined by the U.S. Department of Agriculture. Equal Housing Lender. Karin Herling, NMLS 2619893, is licensed in the states of Washington, Idaho, and California.
Karin, Your Local Loan Lady
Spokane & North Idaho Mortgage Broker
Because You Deserve Better Lending