Types of Mortgages
It is important to know that all secondary market lending guidelines and pricing derive from the same basic entities. Requirements are typically established by the Federal National Mortgage Association (Fannie Mae / FNMA) the Federal Home Loan Mortgage Corporation (Freddie Mac / FHLMC) or the Government National Mortgage Association (Ginnie Mae / GNMA).
A fixed rate mortgage is one where the interest rate on your home loan remains the same throughout its duration.
Adjustable rate mortgages normally have a lower initial interest rate and payment but after an initial fixed rate period, the loan’s rate and payment may adjust based upon changes in market rates through the life of the loan.
Government Insured Loans
Benefits of Government Insured loan products
- Less Cash Needed – Minimum or no-down payment.
- Preserve Your Assets – Allow gifts and grants so customer does not have to tap into any savings
- Accommodating – Except for RD loans, government programs have no income limits, allow higher percentage of income to go toward mortgage payments, and expanded credit guidelines
- Seller Contributions – Allows sellers to contribute toward closing costs up to 4% for VA loans and up to 6% for FHA loans
- Lower Cost – Typically lower cost compared to standard, conventional financing.
Conventional mortgages are not insured or guaranteed by the U.S. Government. Private mortgage insurance is usually required with down payments of less than 20 percent as a protection for the lender’s investment if the borrower defaults. There are many different programs offered with Conventional financing from fixed–rate loans of 10 to 30 years to many Adjustable loan programs.
If you are seeking a loan to help build your home we can help with our bank lenders and mortgage lenders working together to create a lending program to meet your needs.
Whatever your home financing needs, we are ready to help with a broad range of programs, money-saving options and personalized service.