A conventional mortgage/conventional loan is any type of mortgage that is not offered or secured by a government entity (such as the Federal Housing Administration (FHA), the U.S. Department of Veterans Affairs (VA) or the USDA Rural Housing Service), but rather available through a private lender, such as a bank, credit union, mortgage company, or the two government-sponsored enterprises, the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac).
Currently, conventional mortgages comprise about two-thirds of the homeowner’s loans issued in the U.S. The secondary market for conventional mortgages is very large and liquid. Most conventional mortgages are packaged into pass-through mortgage-backed securities, which trade in a well-established forward market known as the mortgage TBA (to be announced) market. Most of these conventional pass-through securities are further secured into collateralized mortgage obligations, or CMOs.
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Home Renovation Loans
Home improvement projects are a great way to not only improve your living space but to add value to your property. Freeing up the money for such endeavors can be challenging but home renovation loans are the perfect way to make the investment without having to break the bank. Whether you’re looking to fix up a bathroom or add a complete addition, there is a loan out there perfectly designed to help you meet your goals.
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An FHA loan is a mortgage that is insured by the Federal Housing Administration (FHA). FHA loans are very popular, especially among first time home buyers because they allow downpayments as low as 3.5% for credit scores of 580 or higher. However, borrowers must purchase mortgage insurance, which protects the lender if a borrower defaults on their loan. The borrower’s credit score may be between 500 – 579 if a 10% downpayment is to be made. It is important to remember though, that the lower the credit score, the higher the interest borrowers will receive in turn.
The FHA loan program was created in response to the wave of foreclosures and defaults that occurred in the 1930s in order to provide mortgage lenders with adequate insurance and to help stimulate the housing market by making loans more affordable and accessible to people with less than stellar credit or a low downpayment. The federal government insures loans for FHA-approved lenders to reduce their risk of loss if a borrower defaults on their mortgage payments.
Interested in an FHA loan?Contact me today to learn more.
VA Loans are mortgage loans issued by approved lenders and guaranteed by the U.S. Department of Veterans Affairs. The program was created in 1944 by the United States government in order to help returning service members purchase a home without needing a downpayment or excellent credit. The VA loan program is in place to assist veterans, active duty military members and their families purchase homes or refinance their existing mortgages.
The VA Home Loan program is very important to service members. Recently, lenders nationwide have tightened their requirements in the wake of the housing market collapse, which makes the VA Loan a lifeline for military homebuyers, many of whom find difficulty when faced with high credit standards and downpayment requirements.
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USDA loans are offered by the U.S. Department of Agriculture mortgage program and may be one of the government’s least-known mortgage assistance programs. A USDA home loan is a zero downpayment mortgage for eligible rural and suburban home buyers. Issued through the USDA loan program, these loans are also known as the USDA Rural Development Guaranteed Housing Loan Program, by the United States Department of Agriculture. This loan program is part of the government’s Rural Development program and aims to help families buy and upgrade their homes in order to improve the economy and quality of life in rural America.
USDA loans offer low interest rates and no downpayments, and is fairly easily to access for most rural and suburban properties.
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When you refinance your mortgage, you are essentially paying off an existing loan and replacing it with a new one. There are many reasons why individuals refinance, such as the opportunity to obtain a lower interest rate, the chance to shorten the term of their current mortgage, the desire to convert from an adjustable-rate mortgage to a fixed-rate mortgage, the opportunity to cash out your home’s equity in order to finance a large purchase, and to consolidate debt.
There are Pros and Cons to all of the above reasons. Refinancing can cost 3% to 6% of the loan’s principal and requires appraisal, title search and application fees, as the original mortgage did. It is important for a homeowner to determine whether his/her reason for refinancing is truly beneficial.
Is refinancing right for you? Contact me today to find out!
Jumbo mortgages are plus-size home loans weighing in at a dollar amount above conforming loan limits. These loans typically come with more demanding requirements than smaller, conforming mortgages. The jumbo loan threshold is $424,100 in most of the U.S, though in some of the higher-cost areas loans have to surpass $636,150 to reach jumbo loan minimals.
Many lenders of jumbo loans require a credit score of 700+, a debt-to-income ratio of 43% or less, and 6-12 months worth of financial reserves in a bank account. When looking for a jumbo loan, you’ll find they require a generally higher downpayment. Depending on the lender, the minimum down payment could be anywhere from 15% to 30% of the home purchase.
Are you looking for top rates on jumbo loans? Contact me today to learn more!
Downpayment Assistance Programs
Saving the money for a downpayment is often one of the biggest challenges for first-time home buyers. Downpayment assistance programs are loan programs intended to help first-time home buyers with this home downpayment. There are numerous loan programs available that offer flexible payment options for home owners. These mortgage loan programs are not just for low income home buyers, there are even downpayment assistance programs available for those who make up to 120% of the average income in the area. Many renters, in particular, aren’t familiar with all of the downpayment assistance programs out there to help them achieve home ownership and stay stuck in the rent loop. There exists a wide variety of programs that could help cover some, or even all, downpayment needs, with some grant programs that don’t even have require repayment.
Contact me today to learn more about available Downpayment Assistance Programs.