Conventional – Conventional loans may be conforming or non-conforming. Conforming loans have terms and conditions that follow the guidelines set forth by Fannie Mae and Freddie Mac. These two stockholder-owned corporations purchase mortgage loans complying with the guidelines from mortgage lending institutions, then package the mortgages into securities and sell the securities to investors. By doing so, Fannie Mae and Freddie Mac provide a continuous flow of affordable funds for home financing that result in the availability of mortgage credit for Americans. Fannie Mae and Freddie Mac guidelines establish the maximum loan amount, borrower credit and income requirements, down payments, and suitable properties. Fannie Mae and Freddie Mac announce new loan limits every year.
FHA – The Federal Housing Administration (FHA), which is part of the U.S Department of Housing and Urban Development (HUD), administers various mortgage loan programs. FHA loans have low down payment requirements and less stringent requirements than many conventional loans.
VA – VA loans are guaranteed by the U.S Department of Veterans Affairs. The guarantee allows veterans and service persons to obtain home loans with favorable terms, usually without a down payment. The U.S Department of Veterans Affairs does not make loans, it guarantees loans made by lenders. VA determines your eligibility and, if you are qualified, VA will issue you a certificate of eligibility to be used in applying for a VA loan.
USDA – USDA and Rural Housing loans are guaranteed by the U.S Department of Agriculture. These guaranteed loans are offered to rural property owners. The guaranteed loan is offered to rural property owners within a specific area determined by the USDA. No down payment is required and 100% of the property value can be financed. (Investment properties are not eligible.)
Jumbo/Non-conforming – Loans above the maximum conforming loan amount established by Fannie Mae and Freddie Mac are known as “jumbo” loans. Because jumbo loans are bought and sold on a much smaller scale, they often have a little higher interest rate than conforming, the spread between the two varies with the economy.
Bridge loans – Bridge loan may enable a borrower to take equity from their current owner occupied home (“Departing Residence”) that is Pending Sale and use the funds to purchase an owner occupied home (“New Purchase”).
Expanded Access (Bank Statement for self-employed clients) – With our Expanded Access/Bank Statement Program, you can get qualified based on your bank statement income. Contact me today to learn more!