MAKE SURE YOU'RE (REALLY) READY You have a stable job.
You can see yourself living in the same town for the next 5-10 years You're prepared for the extra work that comes with homeownership
CREATE YOUR HOME WISH LIST Determine what's most important to have right now- ex: location, # of bedrooms, a yard Check out the different neighborhoods, home styles and listing online to get a feel for what's most important to you.
FIGURE OUT WHAT YOU CAN AFFORD Request your credit report from all threes credit bureaus- fix any errors right away
Determine a down payment amount (ideally 20% to avoid paying private mortgage insurance) Calculate how much you'll need in an emergency fund for unexpected maintenance or repair costs.
GATHER THE NECESSARY DOCUMENTS Collect proof of employment, including pay stubs and past tax returns Print out bank and investment account statements from the past 90 days Compile your previous addresses and current landlord's contact information
RESEARCH MORTGAGES Request quotes form multiple lenders and comparison shop for loans
Get pre-qualified for a loan Obtain a pre-approval letter
Don't Sign Your Lease UNTIL YOU DO THE MATH Every mortgage payment builds equity in a home you own, where do your rent payments go?
MONTHLY RENT 1 YEAR 3 YEARS 5 YEARS 7 YEARS $1000 $1200 $1400 $1600 $1800 $12,000 $14,400 $16,800 $19,200 $21,600 $36,000 $60,000 $84,000 $43,200 $50,400 $57,600 $64,800 $72,000 $84,000 $96,000 $108,000 $100,800 $117,600 $134,400 $151,200
Benefits of Owning Your Home Mortgage interest is tax deductible. * Make any changes you want, without landlord approval.
Build equity every month, invest in your future. Increase the value with home improvements. Never worry about when your lease is up.
*Consult a tax advisor for professional tax advice
Conventional Payments example: If you choose a $250,000, 30 year loan at a fixed of 5.0% (APR 5.1655), with a loan-to-value of 80%, you would make 360 payments of $1,367.38. Payment stated does not include taxes and insurance, which will result in a higher payment.
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