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Types of Financing
Conventional Loans:
Conventional loans usually are more lenient with respect to the
appraisal and condition of the property. If you are purchasing a
"fixer-upper", you may need to use a conventional loan. Also, expensive
homes above the FHA loan limit of $200,160 are generally financed with
conventional loans.
FHA Loans:
FHA Loans are insured by the
Federal Housing Administration under H.U.D. They usually require less
down payment than conventional loans and are easier to qualify for.
VA Loans:
VA Loans are guaranteed by
the Veterans Administration. A veteran must have served 180 days active
service. VA loans can be done with a zero down payment.
Fixed Rate Loans:
Fixed Rate Loans have one
interest rate which is fixed for the entire term of the loan.
Adjustable Rate Mortgages:
Adjustable rate mortgages
have an interest rate that is adjusted at certain intervals based on a
specific index. Some ARM programs fix the interest rate for an initial
period of two to five years, and adjust the rate thereafter at
pre-determined intervals.
Non-Qualifying Loans:
Non-qualifying loans are
pre-existing loans which can be assumed by a buyer from the seller of
property. Without going through the qualifying process, the buyer pays
the seller for his/her equity and then starts making payments. |
