Top 3 Mortgage Loan Types to Fund Your Home Purchase1/17/2011 If you need a home purchase mortgage, there are many loan options available to you. All of them offer different benefits and drawbacks. Three of these loan programs are reviewed below. Conventional MortgageThis is the most common mortgage loan type. These mortgages are optimal for individuals who can afford the necessary 20% down payment and have solid income and cash reserves. You’ll also need to prove that you have a very good credit score. These loans are common and easy to secure, but they’re difficult to qualify for these days and aren’t the best option available to first time home buyers. FHA MortgageAn FHA mortgage is a home loan that is guaranteed by the government. The FHA program was designed to help lower income borrowers purchase homes and live in them. You’ll need to make the home your primary residence for at least three years after you purchase it, but you don’t need a perfect credit score or as high an income to qualify. Also, the down payment you make may be as low as 3.5%. VA MortgageA VA home loan is a specialized loan given to veterans who have served in the US Armed Services. These loans are also guaranteed by the government, and are among the most attractive and financially beneficial loans available today. No down payment is required, and credit and income requirements are minor. Lenders are very lenient to veterans through this program. It’s by far the best financing option to pursue if you’re a veteran and meet the qualification requirements. |
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