10 Things You Should Know


1. Length of Process
The length of the process varies for each borrower and will likely take at least 30 days, depending upon your circumstances. Constant communication with your mortgage banker will help keep you informed of anything that may delay the processing of your application.

2. Budget v. Affordability
Just because you qualify for a certain amount of financing doesn't mean you necessarily need to spend that much on a home. Unexpected bills, a loss in income or a change in family status can all affect your ability to make your monthly mortgage payment in the future. It's also important to have savings and available cash for vacations, entertainment, and other one-time expenses that may not be calculated into your monthly budget. Therefore, it's a good idea to budget for less than you can afford to help protect yourself against any future financial obstacles. Visit our Mortgage Calculators to determine the budget for your home purchase.

3. Total Cost of Home Ownership
Making the transition from renting to buying or upgrading to a larger home means more than a larger housing line item in your budget. You may need to make cosmetic changes or buy additional furniture, appliances and/or décor items to make your new house truly your home. Plus, there isn't a landlord to call when the AC unit breaks or the water heater springs a leak. These kinds of costs need to be factored in when determining how much home you can afford. If your wants exceed your budget, consider buying a less expensive home and financing renovations with one of BankSouth Mortgage's renovation products.

4. Selecting a Mortgage
There are a variety of mortgage programs available, each with its own qualifications and benefits. For example, borrowers in certain rural areas may qualify for a USDA loan with no down payment required. Always contact a mortgage expert when you're ready to begin your home search to determine your qualifications and what loan is right for you. This can also help you avoid problems and keep you knowledgeable about your financial situation.

5. Credit Score
Do you know what your credit score is or what is on your credit report? Your credit score is a large factor in determining whether you will be approved for a mortgage and what your interest rate will be. Therefore, it's a good idea, but not entirely necessary, to research your score and verify the accuracy of your credit report before you apply. For more information on the importance of your credit score, visit our Understanding Credit page. To request a free annual credit report, visit AnnualCreditReport.com. Beware of other sites promising you a free credit score. These often come with hidden enrollment fees and don't provide you with your entire credit report.

6. Down Payment
Don't be scared off from buying a home because you think you can't afford the down payment. There are programs available that can possibly assist you in making your down payment, and there are many down payment options less than 20%.

7. Early Repayment
Locking in a 15- or 30-year mortgage can seem like an overwhelming commitment, but it is possible to pay down your mortgage early. By making two payments each month, you will pay more towards your principle each year and, thereby, pay off your mortgage faster.

8. Mortgage Insurance
Mortgage Insurance is required on FHA loans and Conventional loans with a down payment of less than 20% and is typically paid monthly. This fee protects your lender in case you were to default on your loan payments and can vary based on your down payment and/or credit score. It's important to know your options as Mortgage Insurance will increase your monthly payment.

9. Prequalification
A prequalification gives you an idea of the size of the mortgage you may qualify for based on the information you provide to your mortgage expert. Visit our Prequalification page to learn how a prequalification can be a powerful tool in the home buying process.

10. Buying after a foreclosure, bankruptcy, or short sale
Although your credit history is important, having a past foreclosure, bankruptcy, or short sale on your credit report does NOT mean you cannot qualify for a mortgage. Many factors are considered when determining mortgage loan eligibility. Contact a BankSouth Mortgage expert for additional info.