Services
Full Service Mortgage Banker specializing in purchasing and refinancing.
Conventional Loan:
Usually, a conventional loan is a 30-year fixed rate mortgage. That means it has a fixed interest rate for the 30 year term of the loan. Conventional loans also typically require at least a 20 percent down payment. For example, if a house costs $200,000, the lender will provide a loan for 80 percent of that amount. So, $160,000 is financed through the lender and the borrower must pay $40,000 cash.
Conventional loans can have better interest rates than non-conventional loans and can be a great option for those with a 20 percent down payment. However, even if the borrower does not have a 20 percent down payment, it is still possible to get a mortgage. By putting less down and accepting a possibly higher interest rate, the borrower can still get financing through a non-conventional loan.
FHA Loan:
FHA loans typically offer options for first-time home buyers, senior citizens and home improvements. One of the most difficult elements of the home buying process is saving up enough money for a down payment. If you are a first-time home buyer, an FHA loan may allow you to make a down payment of 3 percent. You may also be able to roll your closing costs and other fees into the loan amount. If you have questions or need advice regarding an FHA loan, you can give us a call at (916) 988-4455.
VA Loan:
A VA loan differs somewhat from a standard mortgage. Even though it is provided through a private lender, the federal government guarantees a portion of the principal. That means that the Department of Veterans Affairs backs the loan, so if the borrower defaults on it, the lender is protected. Borrowers who are eligible for a VA loan are permitted to have a small, or sometimes non-existent, down payment and still get a mortgage. This is the biggest advantage of a VA loan. Be sure to ask your lender what its down payment requirements are when requesting a VA loan. When requesting a VA loan, you need a certificate of eligibility to show the lender. You can get this certificate through the Department of Veterans Affairs. Upon providing it to the lender, the lender can then help you.
Jumbo Loan:
Jumbo loans, as indicated by their name, are larger than conventional mortgages and classified as non-conforming. The reason for the distinction, aside from their cost, is their underwriting guidelines. For some jumbo loans, the underwriting process might require getting more than one appraisal to verify the actual value of the property. And the borrower may have to undergo even more financial investigation and submit more paperwork than normal to be approved. But, unlike some other non-conforming loans, jumbo loans do not deal with the borrower's past credit problems, but rather the size of loan.
Because jumbo loans are for more money than the average price of a home, they carry more risk for lenders. To offset this risk, lenders who offer jumbo loans often charge a higher interest rate and may require a larger down payment than a conventional mortgage. And since fewer home buyers can afford homes valued at over $417,000, the market for jumbo loans is not as broad as it is for conventional loans. That makes the prospect a riskier endeavor for lenders, which is reflected in the interest rate and terms of the mortgage.