There are many different types of mortgage loans available for borrowers with all types of backgrounds. Though different in terms and details, all mortgages can be divided into categories in two different ways.
First, they can be defined as conventional and government loans; and second as fixed-rate and adjustable-rate loans and their combinations.
At Premier Funding Network, we carefully consider your requirements, your financial strength and your long, or short-term investment goals. We have the freedom to take a wider view of both our clients and the loan options available to them. Here is a brief breakdown of some of the most popular loan types:
Conventional loans may be conforming and non-conforming. Conforming loans have terms and conditions that follow the guidelines set forth by Fannie Mae and Freddie Mac. These two stockholder-owned corporations purchase mortgage loans complying with the guidelines from mortgage lending institutions, then package the mortgages into securities and sell the securities to investors.
By doing so, Fannie Mae and Freddie Mac, like Ginnie Mae, provide a continuous flow of affordable funds for home financing that results in the availability of mortgage credit for Americans. Fannie Mae and Freddie Mac guidelines establish the maximum loan amount, borrower credit and income requirements, down payment, and suitable properties. Fannie Mae and Freddie Mac announce new loan limits every year. Learn More
Loans above the maximum loan amount established by Fannie Mae and Freddie Mac are known as ‘jumbo’ loans. Because jumbo loans are bought and sold on a much smaller scale, they often have a little higher interest rate than conforming, but the spread between the two varies with the economy. Learn More
The Federal Housing Administration (FHA), which is part of the U.S. Dept. of Housing and Urban Development (HUD), administers various mortgage loan programs. FHA loans have lower down payment requirements and are easier to qualify for than conventional loans. FHA loans are not made by FHA or HUD but are made by private lenders who underwrite loans to FHA guidelines. FHA insures loans that meet their guidelines. Loan limits for FHA loans will vary based on county limits. Learn More
VA loans are guaranteed by U.S. Dept. of Veterans Affairs. The guaranty allows veterans and service persons to obtain home loans with favorable loan terms, usually without a down payment. In addition, it is easier to qualify for a VA loan than a conventional loan. The U.S. Department of Veterans Affairs does not make loans, it guarantees loans made by lenders. VA determines your eligibility and, if you are qualified, VA will issue you a certificate of eligibility to be used in applying for a VA loan. Learn More
The USDA loan program, also known as the USDA Rural Development Guaranteed Housing Loan Program, is a mortgage loan offered to rural property owners by the United States Department of Agriculture. In order to be eligible for many USDA loans, household income must meet certain guidelines. Also, the home to be purchased must be located in an eligible rural area as defined by USDA. Learn More
A reverse mortgage is a special type of home loan for homeowners 62 and older. There is no repayment until the last surviving borrower passes away, sells the home, or no longer lives in the home as a principal residence. You continue to live in your home and retain title to your home. A reverse mortgage can be used by qualified homeowners to live debt-free or payment-free for the rest of their lives. Learn More
Your Premier Funding Network expert will help you decide which type of loan is the smartest option for both your current financial status and your future goals.