5 Types of Mortgages You Should Know
When you begin to do research on home loans and start mortgage calculations so you can buy your home, you will come across numerous different mortgage products. Some of these products can save you money, while others may not be designed for people in your particular circumstances. For that reason, it helps to know a little bit about the various types of mortgages that will be available to you. That’s where Local Mortgage can help.
In today’s post, we discuss five different types of mortgages that you should know about. This is merely meant to introduce you to these types of home loans, so if you want more information, then feel free to browse our site. You can also get a personalized mortgage quote from the Local Mortgage team. Our experts will help you find the right product for you and get you into your dream home for a low monthly payment!
Conforming Home Loan
Conforming home loans are some of the most common types of mortgages issued in the market today, which makes them an excellent place to start our discussion of mortgage products. Conforming loans are a type of conventional home loan, meaning that they are not backed by a government agency. Although they are not backed by a government agency, conforming home loans do conform to the lending guidelines outlined by Fannie Mae and Freddie Mac, which are two entities created by the U.S. to help stabilize mortgage markets.
Most of the conforming loans issued by Local Mortgage are 30-year, fixed rate loans. In fact, 30-year, fixed rate conforming home loans are probably the most common type of mortgage issued today. Local Mortgage also offers 15-year, fixed rate conforming loans as well as adjustable rate conforming mortgages. You can check our rates for all of these loans on our site, and you can contact one of our experts for help with finding the right conforming loan for your unique needs.
FHA Home Loan
Another popular type of mortgage is the FHA home loan. The Federal Housing Administration (FHA) backs these loans, and they are designed to make it easier to purchase a home. The backing of the FHA allows homebuyers to secure a mortgage even if they can’t make a substantial down payment or meet the typical credit requirements.
FHA loans help homeowners maintain financial stability and as a result, they are often great for younger people looking to purchase their first home. For more information on this type of mortgage, check out our blog explaining the essentials of FHA home loans. You can also check the Local Mortgage rates on FHA loans and ask our experts whether you qualify for one.
Similarly to FHA loans, VA loans are mortgages that are issued by an approved lender (such as Local Mortgage) and then backed financially by a government entity. The U.S. Department of Veteran Affairs (VA) backs VA loans in hopes that veterans and qualified active-duty service members are able to afford purchasing a home. Thanks to the financial backing of the VA, veterans can obtain mortgages with low interest rates and no required down payment.
Our team can help you determine if you qualify for a VA loan. Moreover, Local Mortgage offers competitive rates on VA loans, which you can view here. Get a quote today to begin the process of buying your dream home!
USDA Home Loan
While many people who are familiar with mortgages probably know a bit about FHA and VA loans, they may not know much about USDA home loans. While fewer people meet the requirements necessary to qualify for a USDA loan, this type of mortgage can be a gamechanger for those who do meet the requirements. USDA home loans are mortgages guaranteed by the U.S. Department of Agriculture (USDA), and they are structured to make rural housing more affordable.
USDA home loans typically have lower monthly payments than other types of mortgages. The financial backing of the USDA gives those who qualify the chance to purchase a home at a lower interest rate than they would otherwise pay, giving them a better chance at financial stability and affordable housing costs. We have a whole blog devoted to explaining the basics of USDA loans, and you can see our current rates for this type of mortgage here.
The last type of mortgage that we think you should be aware of is the jumbo home loan. Jumbo loans are mortgages for people that need to borrow more than the limit on conforming loans, which is set at $484,350 in 2019 for most areas. Like conforming loans, jumbo loans can come in 15 and 30 year terms, and they can feature either fixed rates or adjustable rates.
Since jumbo loans exceed the maximum limits set for conforming loans, they can be a little bit more difficult to qualify for. That said, they often feature low rates, and jumbo loans can help you purchase the home of your dreams. Feel free to get a quote on a jumbo loan from Local Mortgage today!
Get a Home Loan from Local Mortgage
Hopefully today’s post has helped you learn more about some of the different types of mortgages available. If you would like to learn more about these mortgage products and discover which one is best for your circumstances, then contact Local Mortgage today. Our team will help you determine which type of mortgage will help you save the most money while purchasing your next home.