1. Weigh the pros and cons of buying a home
Owning a home can be a rewarding experience, but it's important to prepare for this major milestone. Carefully weigh the pros and cons of purchasing a home versus continuing to rent, and determine whether buying a home is the right decision for you and your family.
2. Look at the big picture
While buying a house can be rewarding, it can be labor intensive and expensive. Leaky roofs, plumbing issues and other home repairs can add up. Consider the cost of general maintenance and unexpected expenses when determining if you're ready for homeownership.
3. Check your credit
Take a look at your credit report and FICO score. They will impact your overall loan costs. Once you get your free annual credit report, comb through it for any errors or unresolved issues and contact the appropriate credit-reporting bureau - Experian, Equifax and TransUnion - to ensure they are corrected. You can obtain your credit report from each of these bureaus by visiting AnnualCreditReport.com.
4. Get pre-approved
Your SunTrust Mortgage loan officer can help you determine the loan amount you might qualify for through a pre-approval1 process. Being pre-approved before searching for a home is very useful because it helps you look for homes within your price range. Real estate agents also appreciate buyers who submit offers on homes with a pre-approval letter. You can access our pre-approval form to get started.
5. Prepare a budget
While pre-approval can serve as an estimate of what you may be able to borrow, it's equally important that you feel comfortable with your monthly payments. Before applying for any loan—and especially for something the size of a mortgage—it’s important to determine how much you can afford to pay each month. Look at all current monthly expenses, as well as how much you save each month. Typically, it’s recommended that you spend no more than 28 percent of your monthly income on housing expenses, including your mortgage, taxes and insurance costs. Our mortgage calculator can help estimate the cost of your monthly payment so you can set a budget that works for you.
6. Don't forget taxes and insurance
Contact a local insurance agent for an estimate on a comparable property in the area you’re considering. To get a better idea of what you’ll pay in taxes, check the local property assessor’s website. Remember that the amount of taxes a homeowner is currently paying and what you can expect to pay may differ depending on exemptions and local tax laws.
7. Putting money down
Most mortgage programs require you to make a down payment when you purchase a home. The amount of the required down payment will vary, depending on the type of mortgage program
8. Begin your home search
Decide on a location and identify the features you want in a home. Check local listings, compare prices of similar homes and consult with your real estate agent to help determine the amount you can expect to pay. If you’re not already working with a real estate agent, consult with friends, neighbors or a local real estate agent association for help finding one that specializes in housing options in your area.
9. Loan application process
In addition to determining the type of mortgage you'd like to pursue and determining your interest rate, gathering the right documents is a critical step that can save time and frustration down the road. To ensure a smooth loan application process, you’ll likely need to collect:
10. Closing the deal
Once you've found the home of your dreams, there are steps related to sealing the deal, including negotiating a purchase price, getting an appraisal and scheduling an inspection. Once you and the seller reach an agreement, you’ll want to consider closing costs. They typically include origination fees, title and settlement fees, taxes, and prepaid items like homeowner’s insurance or association fees. Your realtor can help you determine all property-related costs.
This material is educational in nature and is not an advertisement for a loan. It does not constitute legal, tax, accounting, financial or investment advice. You are encouraged to consult with competent legal, tax, accounting, financial or investment professionals based on your specific circumstance. We do not make any warranties as to accuracy or completeness of the information, do not endorse any third-party companies, products, or services described here, and take no liability for your use of the information.
1 Pre-approval is based on non-verified information and is not a commitment to make you a loan by SunTrust Mortgage. Loan approval will be subject to, but not limited to, verification of all income, asset and liability information provided by you, satisfactory property appraisal, compliance with SunTrust Mortgage’s loan program guidelines and all required closing conditions such as survey and title examination.
When it comes to the amount of money you need to put down toward a home, there may be more flexibility—and you may have more options—than you think.
Upgrading your home is exciting and can improve the quality of your home life—but is it always worth the price tag?
A Home Equity Line of Credit (HELOC) lets you tap into the equity in your home and borrow against it for things like home improvements or other major expenses.
Learn about the two documents you’ll receive after submitting your mortgage application—and how they can help you understand the true cost of your home loan.
Do you know the difference between a loan or a line of credit that's secured or unsecured? You will.
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