Financing

The first step in the home buying process is getting Pre-Approved for a Mortgage. This will determine how much you can spend on a home. You should know that not all mortgages are created equal. Lenders will require different down payments, interest rates, fees, and guidelines to certify that you’re qualified for a mortgage.

As a home buyer, it is critical that you find the best one that fits your financial capacity. We highly suggest that you contact several institutions to see what each can offer and then decide which is the best for you. We are happy to provide you with several lender options from which you can determine if one meets your needs.

While loan guidelines will ultimately depend on your lender, here are four of the most common home mortgages you will likely come across:

 Common Mortgage Loans
 

Conventional

  • More Financing Options

  • Good Credit

  • All Occupancy Types

  • 10-30 Year Fixed Terms

  • High 95% Loan to Value

  • Down payment from 3-20%

  • If below 20% will require PMI insurance

FHA

  • Low payments

  • Low Credit Score Option

  • Easier to Qualify

  • 10-30 Year Fixed Rate

  • High 96.5% Loan to Value

  • A loan backed by the Federal Housing Administration (FHA)

  • Stricter appraisal requirements

 

VA Loan

  • Low Loan Payments

  • Limited to Eligible Veterans

  • No Mortgage Insurance

  • 15-30 Year Fixed Rate

  • Zero Down Payment

  • Mandatory Funding Fee

Jumbo

  • Loan values in excess of FHFA Standards, typically over $647k

  • Often balloon payments at end of the loan term

  • Excellent Credit Score required

  • Borrower has Low debt-to-income ratio

  • May have a higher interest rate