Considering a home purchase? Whether you are building a new home or purchasing an existing home, home ownership has several advantages.

First, when you purchase a home, your interest and property taxes can be deducted from your federal and some state income taxes. These significant deductions can mean considerable savings in your yearly income taxes.

Second, owning a home allows you to build equity – or savings – in your home. As you make payments on your loan, you begin to pay off the principal – or initial – loan amount, thereby creating a savings account within your home. As your home increases in value, so does your savings account.

When beginning your search for a new home, it is important to speak with a loan advisor to find out how much home you can afford. A loan advisor will help to ensure that you are pre-qualified by looking at your income and assets, as well as your credit scores and debt ratio to help you decide how much you are able to purchase.

Your home loan will either be a Fixed-Rate mortgage or an Adjustable- Rate mortgage (ARM). Your loan advisor can help you decide which is the best option for you based on how long you plan to keep the home loan, how much financial risk you are willing to assume and how much you need to borrow. An ARM has an interest rate that may move from time to time as changes in the market occur whereas a Fixed-Rate mortgage has a set rate that will not change based on market conditions.

Your monthly mortgage payment will include the principal, the interest on the loan and possibly your taxes and insurance

There are several options available when considering a home loan and it is therefore important to discuss exactly what you are looking for with your loan advisor. Whether you are looking for 100% financing or are able to make a large down payment, speak with your loan advisor about the new purchase loan that is right for you.