Steps to Prepare
for a Mortgage and Homeownership

BUYING A HOME IS EXCITING...

but you must ensure you have all your ducks in a row before undertaking such a big financial move. The more you plan, the better off you’ll be. If you are unsure about the home-buying process, our Preparing to Buy a Home guide below can help you feel confident throughout your journey. Here are some steps to take that will prepare your finances for a mortgage:

RAISE YOUR SCORE

One of the most important things to do before applying for a mortgage is to make sure your credit score is as high as possible. The higher your score, the lower your interest rate will be. That is a big deal, as it makes paying your mortgage manageable. The best way to improve your credit score is to pay bills on time, every time. Pay down all unsecured debt like high-interest credit cards or personal loans.

CHECK YOUR REPORT

You should also check your credit report for inaccuracies. Incorrect information on your credit report could negatively impact your score. Review your report for errors, then report them to the bureau immediately. Be sure to check your report with all three credit bureaus — Experian, Equifax, and TransUnion.

GATHER SAVINGS

The bigger down-payment you make, the more affordable your mortgage will be over time. A large down payment typically means you’ll have lower monthly payments. You’ll also have an advantage over other potential buyers, as a large down payment signals to sellers that you mean business. A good rule of thumb for a down payment on a house is about 20 percent. In addition to the down payment, you’ll also want to save for closing costs and the ongoing cost of homeownership. The more you save, the easier it will be to handle mortgage payments.

PREPARE YOUR DOCUMENTS

Having the right documentation can make the home-buying process much easier. The loan officer will require financial documentation throughout the loan approval process. Our Understanding the Home Buying Process infographic below can help ensure you are prepared. We even have a Home Buying Document Checklist you can download! The best way to stay organized is to mark off the documents as you submit them to make sure you stay on track during your home-buying process.

We're here to help!

Visit our Mortgage Center to learn more about the types of mortgage loans The Southern offers and to meet the Mortgage Team! From there you can also apply online and upload documents.  If you already own your home, visit our Second Mortgages and Home Equity page to learn more about refinance or equity options. You may also stop by our Fayetteville branch to speak to one of our Mortgage team members or give us a call at 770.719.1111.