Ready to buy? Here's how to get started.
Make a list of the top-five most important things you’re looking for in a home. Your list might include things like price, distance to work, school rankings, number of bedrooms, and a nice, big yard for your dog.
Talk with a Mortgage Loan Originator to find out how much you qualify for so you can confidently shop for homes in your price range.
Choose a Real Estate Agent to help with your home search. Provide the Agent your list from step 1, so they can find homes that fit your needs.
Buying a home is a big decision. For many buyers, the experience can be stressful. Teaming up with a Real Estate Agent and HomeBridge Mortgage Loan Originator will make the process much easier so you can enjoy the fun part.
We’re here to help when you’re ready to buy. Here are some things you should keep in mind. Buying a home allows you to:
Make it Your Dream
When you own your own home, you can paint, knock out walls, garden and remake the landscape. Finally get that dog. It’s up to you.
Create a Place for Family and Friends
You can grow in your new home, with friends and family surrounding you. This will truly be a place where you put down roots and build a new life.
Be a Part of the Community
Buying a home is an investment in the community and people around you. It brings stability to you and the surrounding neighborhood.
Gain home equity by paying principal.
The principal portion of every mortgage payment you make has the potential to grow your asset.
Get Tax Benefits
Take advantage of tax benefits. As mortgage industry and real estate taxes are usually tax deductible. (Consult a tax advisor regarding the deductibility of interest and charges.)
Build your credit by making on-time mortgage payments. This can help you create and maintain a strong credit history.
Additional considerations include:
Commitment to making a monthly payment in full and on time, today and into the future.
Extra expenses, including property taxes, homeowners insurance, homeowners association dues, tax assessments, and, if you put down less than 20%, private mortgage insurance.
Unpredictable maintenance, including small expenses, like a clogged drain, to big expenses, like replacing a roof.
If you’re thinking of buying, a Mortgage Loan Originator can help weigh all the benefits to see if it makes sense.
Second Homes and Investment Properties
Having a second home for escapes to the beach, the lake or the mountains, tops our list of reasons why it’s rewarding to own another property. And for those who like to focus on the practical, these investment properties bring rental opportunities, ongoing income, potential tax benefits and offer a boost to your investment portfolio. Things to consider when thinking about buying a second home:
- Rent from Investment Properties –You’ll have an additional source of income from on-going rental payments.
- Save on Vacation Expenses – Owning a second home may work out to long term savings. Investing your vacation budget into your own home instead of renting a vacation property or staying in a hotel could add up to a financial gain in the long term.
- Tax Benefits–You may get tax benefits depending on if you rent the property or stay there frequently. Ask a tax advisor for the details.
Things to keep in mind before buying a second home:
- Extra Expenses–In addition to taking on a second mortgage, you’ll be responsible for upkeep fees like cleaning services, homeowners association fees, flood insurance and paying utilities.
- Different Loan Requirements–Investment property loans typically have higher interest rates, require larger down payments and have different underwriting requirements than loans for homes that are occupied by the owner.
Down Payment Options
The down payment is the part of the purchase price the buyer pays in cash and does not finance with a mortgage. Down payments are a percentage of the home’s selling price. For example, a 20% down payment on a $100,000 home is $20,000. Placing down payments helps protect buyers in a fluctuating housing market, creates equity, improves your credit score, and often lowers your interest rate. A down payment also shows lenders that you are serious about the purchase. As an added bonus, whatever you put down is money you won’t be paying interest on.
The type of mortgage determines the minimum down payment needed, usually ranging from 0% to 20%. Your Mortgage Loan Originator will let you know what down payment percentage is required of you and how much you should put down in order to save the most money in the long run.
Options for Veterans
Veterans Administration (VA) loans are designed to help Veterans obtain financing at very reasonable rates and offer financing up to 100% of the home’s value.¹ This means that a qualified Veteran, spouse or active-duty military member could buy without having to make a down payment.
Government Loan Options
The Federal Housing Administration (FHA) was created to help middle- to lower-income buyers secure home loans. The FHA doesn’t actually lend the money; instead, it insures the loan. The FHA requires down payments as low as 3.5% and accepts a wide range of credit scores.
¹100% financing available on primary residences up to county loan limits.
Documents You Will Need
Here’s a quick look at the documents that you’ll need to pull together.
- Copy of drivers license and Social Security card.
- Address(es) for the past two years. Borrowers who have been renting may be asked to get a letter signed by your landlord verifying that you’ve been paying rent and that you’ve paid it on time.
- Employment for the past two years. We’ll need name(s) and address of each employer along with more information on any gap in employment.
- Income for the past two years. The fastest way to do this is to provide your last two tax returns along with copies of your pay stubs from the past two months.
- All money-related assets. You will be asked to provide the last two or three months’ statements from all checking accounts, savings accounts, money market, IRA, mutual fund and brokerage (stock) accounts.
- All debts. HomeBridge will pull your credit report to reveal the information we need on credit card debt, installment loans (like student loans), car loans and your current mortgage or home equity loans if you’re refinancing.
- The Sales Contract. HomeBridge will need a copy of your original purchase agreement.
Specific situations may require additional documentation, including:
- Income from child support or alimony
- Self-employed borrowers
- Borrowers owning investment properties
- Borrowers with a previous bankruptcy
- Divorced or separated borrowers
- Proof of VA eligibility