Loan Types

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 FHA Loan Requirements

Here’s what you’ll need to get started.

1. Minimum 580 Credit Score
   FHA requires a minimum of a 580 credit score. 
2. 3.5% Down Payment
   You’ll need to make a down payment of at least 3.5% of your new home’s purchase price.
3. 3% – 6% In Closing Costs
   With an FHA loan, you’ll need 3% – 6% of the purchase price available to cover closing costs.
4. Mortgage Insurance Premium (MIP)
   You’ll pay an upfront mortgage insurance premium of 1.75% of the base loan amount as well as monthly MIP.

Low Credit Score Requirements

You can get an FHA loan with a credit score of just 580 or higher.

Low Down Payment

With an FHA loan, you can put as little as 3.5% down.

Flexible Debt-To-Income Requirements

FHA loans come with less stringent debt-to-income (DTI) requirements than some other loans.

Flexible Borrowing Options

You can choose between a 15-year and 30-year term – with either a fixed or variable interest rate.

Shorter Waiting Periods

You may qualify for an FHA loan sooner after a major event such as a foreclosure, bankruptcy or missed payment.

  VA Loan Requirements

Here’s what you’ll need to get started.

1. 580 Median Credit Score
   A 580 credit score requirement means you don’t need perfect credit to get a VA loan.
2. Certificate of Eligibility (COE)
   You’ll need to obtain a COE to show lenders that you’re a qualifying service member or surviving spouse.
3. Debt-To-Income Ratio ≤ 60%
   This debt-to-income (DTI) ratio makes VA loans more accessible than some other loan options.
4. VA Funding Fee
   This one-time fee paid to the Department of Veterans Affairs may vary depending on the size of your down payment.

No Down Payment

In most cases, a VA loan allows you to purchase your new home with no money down.

Competitive Interest Rates

VA loans offer competitive interest rates, relative to some other home loan options.

No Private Mortgage Insurance

VA loans don’t require you to make monthly mortgage insurance payments.

100% Access To Home Equity

A VA loan is the only loan that allows you to convert up to 100% of your equity into cash if you qualify.

Rate And Term Refinance Options

If you have an existing VA loan, you may be able to lower your rate or change your term with fewer documentation requirements. Often, no appraisal is required.

 USDA LOAN-

• Zero money down and 100% financing is available
• USDA loans come directly from the federal government or from government approved and backed lenders
• You can have lower monthly payments with terms up to 38 years
• Bad credit can qualify
• Low income families can qualify

• New Home
• Pre-existing home
• Condominium
• Townhouse
• Land and the cost of building a home
• Commercial property
• Farms and equipment

 What is a Conventional Loan?

A conventional loan is a type of mortgage that is not insured or guaranteed by the government, unlike FHA, VA, or USDA loans. Instead, conventional loans are backed by private lenders, such as banks, credit unions, and mortgage companies. These loans typically adhere to guidelines set by Fannie Mae and Freddie Mac, two government-sponsored enterprises that buy and sell mortgages on the secondary market.

Key Features of Conventional Loans:

1. Down Payment Flexibility: Conventional loans offer a variety of down payment options, including as little as 3% down for qualified borrowers. This flexibility makes conventional loans an attractive option for first-time homebuyers and those who may not have a large down payment saved up.
2. Loan Limits: Conventional loans have maximum loan limits set by Fannie Mae and Freddie Mac. These limits vary depending on the location of the property and are subject to change annually. Borrowers can typically obtain larger loan amounts with conventional loans compared to government-backed loans.
3. Private Mortgage Insurance (PMI): If you make a down payment of less than 20% on a conventional loan, you will likely be required to pay private mortgage insurance (PMI). PMI protects the lender in case you default on the loan. However, once you reach 20% equity in your home, you may be able to cancel PMI, potentially lowering your monthly payments.
4. Credit Requirements: Conventional loans typically have stricter credit score requirements compared to government-backed loans. While requirements may vary depending on the lender, borrowers generally need a credit score of 620 or higher to qualify for a conventional loan. However, a higher credit score may result in better interest rates and terms.
5. Fixed-Rate and Adjustable-Rate Options: Conventional loans offer both fixed-rate and adjustable-rate mortgage (ARM) options. With a fixed-rate mortgage, your interest rate remains constant throughout the life of the loan, providing predictability and stability. On the other hand, an ARM may offer lower initial interest rates and monthly payments, but the rate can adjust periodically based on market conditions.