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2012 Mortgage Guide

The new year has arrived, and there's no better time to think about buying a home! Prices are at record lows, and a huge selection of available houses exists for your perusal. Before you start shopping though, you'll need to find a mortgage. Lender 411 has the key to getting the loan you'll need to get into the home of your dreams with our 2012 mortgage guide. Below is a list of the 5 most popular mortgage types to help you decide which is the right choice for you.

1. FHA Loans

FHA mortgages are insured by the government through mortgage insurance funded into the loan. First-time home buyers are typically perfect candidates for FHA loans, thanks to the minimal down payment requirements.

2. VA Loans

Another type of government loan, this mortgage is available to veterans who have served in the U.S. Armed Services, and in some cases, to the spouses of deceased veterans. Eligibility varies depending on the year of service and whether the discharge was honorable or dishonorable. The greatest benefit of a VA loan is that the borrower does not need a down payment. VA loans are guaranteed by the Department of Veteran Affairs, but funded by a conventional lender.

3. Interest-Only Mortgages

Calling a mortgage loan type an "interest-only" is a bit of a misleading term. Interest-only loans contain an option to make an interest-only payment, which is available only for a certain period of time. However, some junior mortgages are truly interest only and require a "balloon payment", consisting of the original loan balance at maturity.

4. Adjustable-Rate Mortgages

Adjustable-rate mortgages (ARMs) come in many flavors, colors and sizes. With ARMs, the interest rate fluctuates. It can move up or down monthly, semi-annually, annually or remain fixed for a period of time before it adjusts. Be wary of these, as unexpected jumps have sometimes driven some homeowners into foreclosure.

5. Reverse Mortgages

Reverse mortgage are available to any person over the age of 62 who has enough equity. Instead of making monthly payments to the lender, the lender makes monthly payments to the borrower for as long as the borrower resides in the home. The interest rate can be fixed or adjustable. At the end of the loan term, the borrower may either pay off the loan or use the property as payment.

To find out more about any of these options, simply click through the myriad of resources Lender 411 has within the site, as well as tools like calculators you can use to prepare yourself for your 2012 home search!

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