The right loan program for you will be the one with the ideal combination of factors for you, your family and your financial situation. These factors include an affordable down payment, manageable monthly payment, low interest rate, low closing costs, and if required, low cost of mortgage insurance. All are important when choosing your loan program, and you will no doubt need to prioritize what is most important for you.
Not all borrowers will qualify for all programs. Programs available for an individual borrower will be based on a number of factors, including credit history and credit scores, down payment available, stability of income and employment, debt-to-income ratio, and whether or not the borrower is a first-time home buyer.
As a part of the pre-approval process, we will evaluate the best options for you.
Here are some of the options that we will look at.
| Conventional Loans with Standard Down Payments – For All Borrowers | ||
| Fannie Mae | 20% Down Payment | No mortgage insurance is needed with a 20% down payment or more. |
| and | 25% Down Payment | The offer available with a 25% or 40% down payment may be slightly improved. |
| Freddie Mac | 40% Down Payment | There is no benefit to the rate with a down payment greater than 40%. |
| Fannie Mae | 15% Down Payment | Mortgage insurance can be paid monthly, or in a single premium, or a combination. |
| and | 10% Down Payment | Single Premium can be “rolled into the rate” with Lender Paid Mortgage Insurance. |
| Freddie Mac | 5% Down Payment | The cost of mortgage insurance increases as the down payment decreases. |
| Low Down Payment Programs | ||
| VA | 0 Down Payment | Must have earned the VA benefit as a military veteran or reservist |
| Must pay a “Funding Fee” which varies and can be financed into the loan. | ||
| The “Funding Fee” is lowest for First Time Home Buyers. | ||
| There is no monthly mortgage insurance premium. | ||
| USDA | 0 Down Payment | Must pay “Guarantee Fee” which can be financed into the loan. |
| Must also pay monthly mortgage insurance premium. | ||
| Only available in certain rural areas. | ||
| Borrower must meet income limitations specific to the property address. | ||
| You do not need to be a First Time Home Buyer. | ||
| FHA | 3.5% Down Payment | Must pay “Up Front Funding Fee” which is typically financed into the loan |
| Must also pay monthly mortgage insurance premium. | ||
| Monthly mortgage insurance premium never goes away. | ||
| You do not need to be a First Time Home Buyer. | ||
| Fannie Mae Home Ready | 3% Down Payment Allowed | You must be a First Time Home Buyer to qualify for a 3% down payment. All other borrowers must put down at least 5%. |
| Freddie Mac Home Possible | 3% Down Payment Allowed | You must be a First Time Home Buyer to qualify for a 3% down payment. All other borrowers must put down at least 5%. |
| Mortgage Credit Certificate | N/A – overlay program | Special Federal Tax Credit Program. Read more about it here… |
| Can be used with ALL mortgage type – for First Time Home Buyers* | ||
| Maximum purchase price is $260,000 | ||
| Maximum property size is 5 acres | ||
| Maximum income is HOUSEHOLD based per median county income charts | ||
| * Available for military veterans | ||
| * Available for buyers who have not owned a home in the past 3 years | ||