Selling Your Home in 2015? Boost Your Resale Value with These Three Inexpensive Renovations

What are the Common Types of Home Loans – Mortgages?

Wow, as if picking out the right home is not a big enough challenge for you, you also have to make a decision on the type of mortgage that is right for you.  Sometimes this can seem like getting ready for a big date.  You want it to look good and fit you right.  Kelly and I are very good at helping you with picking out the right home, but you will need a mortgage broker to help you through the decision process for a loan.

There are several factors that influence the kinds of mortgages available to you:

-                                              * How much you are pre-approved for

-                                             *   How much money you have available for down-payment and closing

-                                             *  Military service

-                                             * Where the home is located

-                                             * How long you want to have the debt

-                                             *  Variable and fixed interest rates

The most flexible loan is a conventional loan.  It is available to buyers with excellent credit, and there are no limits on income, where the home is located, and whether you will live there as owner occupant, part time, or are buying as an investor.  This type of loan requires a more substantial down-payment, usually 20 percent or more, and offers flexibility in length of term and fixed versus variable rates of interest.  It is sometimes a challenge for first time home buyers to qualify for this one, so if you plan to go in this direction, save, save, save.

The Federal Housing Authority helps lenders work with buyers who need more flexible guidelines.  These FHA loans have less stringent credit requirements, a lower down payment, 3.5% or so, and are much more common among first time buyers.  There are additional monthly costs associated with such a small down-payment, though, that can last the life of the loan.

The US Department of Agriculture supports loans outside of urban settings, to encourage rural home and population growth.  The first requirement for this type of loan is that the home you want to buy be in an approved area.  In the Upstate, there is a significant portion of each county where this loan is possible.  It has the benefit of no down-payment and flexibility with credit. But there are also limits to income level for this loan.  This can make a USDA loan very desirable for first time home buyers.  Ask us about any address and we can tell you if it fits the location requirement.

The U.S. Government shows its appreciation to military veterans through the Veterans Administration guaranteeing loans for home purchases.  These loans have very favorable credit guidelines, no down payment required, and often some very good interest rates as well.  Most lenders provide these types of loans, so make sure if you are a military veteran you ask them about the possibility of getting this type of loan.

We work with a number of mortgage lenders, and see a great deal of support for borrowers throughout the process.  They have your best interests at heart, but are also in place to make sure your decisions are wise for both you and the lender.  You don’t have to sign anything to ask, so give your lender a call, or if you need some recommendations call us for suggestions.

Oh, and you do look good today.