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Purchasing a home may be the largest investment you will ever make. Owning a home has great benefits. It also comes with certain responsibilities.
To be ready for homeownership, you must have:
a two-year history of a continuing, reliable, and verifiable source of income prior to applying for the loan;
a credit history that shows you're ready for homeownership (Click here to learn more about how to repair prior bad credit);
sufficient income to take on the costs associated with homeownership and to meet other debt payments (Calculate how much you might afford with our mortgage affordability calculator); and
Owning a home has many advantages. But buying a home is an important decision. Look at the benefits to better understand if owning a home is right for you.
Tax advantages - Itemizing annual mortgage interest and property taxes on both your Federal and New York State income tax returns may result in tax savings to you.
More stable monthly housing payment - Your SONYMA monthly mortgage payment will remain the same for the life of your mortgage.
Build equity in your home - Building equity in your home over the life of your loan could help you achieve future goals like improving your home, paying for your child's education, or saving for retirement.
Property value appreciation - In many areas, property values have risen. There is no guarantee that the value of your home will increase or even maintain its value. However, under the right conditions, many home owners have seen their property values increase over time.
Pride of ownership - Owning a home is a primary goal for most Americans. Achieving the American dream of homeownership gives you a sense of pride and security.
Homeownership is a good investment for many people, but there are risks. If you understand the benefits and risks of homeownership, you can make the best decision about if and when to buy a home.
Higher monthly housing payment - In some cases, homeownership can put a strain on a family's finances. Usually, over the first few years, a homeowner will end up paying more for housing than a renter might, even if mortgage payments are less than paid previously for rent. This is because homeowners must also pay property taxes, homeowner's insurance, utilities and maintenance expenses. However, these higher monthly payments may be offset by a tax benefit at the end of the year. Talk to a tax professional to understand your particular situation.
Repairs and maintenance - You will be responsible for the maintenance and upkeep of your home and your property, such as repairing or replacing appliances, mowing the lawn or repairing the roof.
Decreased mobility - As a homeowner, you will have less mobility than a renter. There is a considerable amount of time, effort and sometimes even cost involved in selling your home. Therefore, if you anticipate being transferred to a new job location within the next year or two, this might not be the ideal time to buy a house.
Property values can depreciate - A home can lose value for a number of reasons, such as a recession, the condition of the home not being maintained, or a drop in a neighborhood's home values. If your home loses value and you have to sell it for less than you owe, you will still be required to repay the full mortgage.