SunTrust Mortgage Review

SunTrust Mortgage is the mortgage lending division of SunTrust Banks Inc., an American bank holding company with 1700 branches and offices throughout the southern United States. In its current form, SunTrust Banks Inc. is the result of the 1985 merger of the Trust Company of Georgia and Sun Banks Inc of Florida.

The Trust Company of Georgia helped underwrite the initial public offering of Coca Cola in 1919. As a result, SunTrust Banks Inc. holds 48.3 millions shares of Coca Cola worth approximately $2 billion and paying $59 million each year in dividends. Two SunTrust executives currently sit on the board of Coca Cola, and one Coca Cola executive sits on the board of SunTrust.

SunTrust Mortgage offers ten to forty year fixed rate mortgages at competitive pricing with financing on up to 103% of the property value. No income verification loans for self-employed buyers are also offered (assets and unearned income are still verified), as well as fixed rate loans for people with “less than perfect credit.”

SunTrust offers a variety of ARM products, from one year ARM loans to 7 year ARMs, with a 95% loan to value ratio. All SunTrust ARM loans have a cap on interest rate increases over the life of the loan and from year to year.

SunTrust Mortgage offers special 100% financing mortgage program for certain rural property purchases, and also special programs for low to moderate income households.

In many circumstances the down payment on a home can be a gift or can be financed as well through a variety of options with SunTrust itself.

Mortgage payment options with SunTrust are straightforward. Buyers can send payments by mail, set up ACH payments on a recurring monthly basis, make one-time ACH payments for a fee that varies by payment amount, or set up bi-weekly payments for a fee. The bi-weekly payment option is especially good for buyers who can afford it, since it shaves some time and money off the mortgage and builds equity more quickly.

SunTrust Mortgage also offers Jumbo loans, FHA, and VA mortgages, and special terms for loans on student condominiums.

SunTrust Banks recently partnered with the city of West Palm Beach, Florida to open a foreclosure help center. With Bank of America and Bank Atlantic, SunTrust will be one of only a handful of banks willing to buy foreclosed properties and work out new terms for people behind on their loans. They will also provide counselling to help these same homeowners to repair their credit.

Florida foreclosures are up 70% over last year. Currently the state is behind only CA and Nevada in number of foreclosures. While many lenders have given lip service to the current loan crisis and the need for individual assistance, SunTrust is one of the few to actually make a commitment to refinance and write off some loan amount in order to keep Florida residents in their homes.

While SunTrust stock is currently at a low point historically speaking, it seems to be due more to the general turmoil in the mortgage and banking industry, and less to the policies of SunTrust Mortgage itself. In March of 2008, Motley Fool listed it as one of the top stock bargains in a bad market: http://www.fool.com/investing/general/2008/03/31/the-scariest-market-in-six-years.aspx which is high praise in these troubled times.