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Most Americans Can’t Properly Define Mortgage Rate, Other Real Estate Terms

by Leighton, Kelly on

Most Americans struggle to define the most common homebuying terms.

MoneyWise recently surveyed more than 1,000 adults, and 56% failed the homebuying term quiz. More than three-quarters of Generation Z failed the quiz, as did 58% of millennials. There wasn’t a single term that more than half of Generation Z could define correctly. Overall, while 62% of Americans couldn’t define mortgage rate, another 50% couldn’t define interest and 48% couldn’t define offer. Nearly half (48%) couldn’t define down payment, while 46% couldn’t define appreciation and 42% couldn’t define mortgage.

Where are most people getting their real estate information? According to results, 61% said friends and family, while 58% rely on real estate experts and 47% turn to the internet. Baby boomers were the most likely to turn to an agent, followed by millennials.

There was also a divide between non-homeowners and homeowners on opinions. For homeowners, they saved around $66,400 before making a down payment, while non-owners plan to have about $39,400 saved. The majority of homeowners (78%) put down more than 20% as a down payment, while only 19% of non-homeowners plan to do the same. Most non-owners (60%) plan to put down between 6% and 19%.

For those who have bought already, home loans caused regrets for some. The biggest regret was an adjustable mortgage, said 78%, while 71% regretted a government-insured loan and 70% wish they had not taken a jumbo loan. Most (71%) reported regretting having a 15-year loan, while 27% of those with a 30-year loan regretted it. The majority of homeowners (55%) said they rushed their homebuying process because of perceived market pressure, with that number rising to nearly 70% for those who purchased from 2019 to now.

Topics

Homebuyers
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