TYPES OF MORTGAGE LOANS
FHA 3.5 percent down
With an FHA loan, you can get a loan with 3.5 percent down and it will require more expensive mortgage insurance than that of the Fannie and Freddie programs, but the qualification guidelines are often less stringent, especially when it comes to required reserves left over after the close.
FHA loans were the most popular low-down loan immediately after the crisis, but other options continue emerging that are more beneficial for borrowers, and less risky for lenders.
A conventional loan is a type of mortgage loan that is not insured or guaranteed by the government. Instead, the loan is backed by private lenders, and its insurance is usually paid by the borrower.
CONVENTIONAL LOANS (3% – 5% down p
ayment)
Conventional loans are much more common than government-backed financing. In the first quarter of 2018, conventional loans were used for 74% of all new home sales, making them the most popular home financing option—by a long shot.
Though conventional loans offer buyers more flexibility, they’re also riskier because they’re not insured by the federal government. This also means it can be harder for you to qualify for a conventional loan. But we could help you to get your loan and save a lot of money in real estate.
FOREIGN NATIONAL (25% – 30%)
A foreign national loan is a special type of loan that helps noncitizens buy investment property in the United States. This loan has requirements (and interest rates) that slightly differ from standard loans. Here are some key factors noncitizens looking to invest in property need to keep in mind.
You will need a bigger down payment
The down payment needed to qualify for a foreign national loan is much more substantial than the amount needed for a government-backed loan (e.g., an FHA loan) or a mortgage from a private lender. You need to put down at least 25%.
U.S. citizens can qualify for standard home loans with as little as 3.5% to 5% down, but buyers from out of the country must have at least a quarter of the purchase price of the property to get financing.
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