What mortgage LOAN product Best fits your scenario?

The most common loan is a conventional loan, a loan is a “conforming” loan, which simply means that it meets the requirements for Fannie Mae or Freddie Mac.  

• Good to Great credit
• Loan Terms Vary - 30, 20, 15, as low as 8 year conventional loans options
• Home purchase with as little as 5% down
• Conventional loans with less than 20% down payment, PMI (Private Mortgage Insurance) will be added.
• Great option for self- employed borrowers,  while other loans require 2 years of tax returns, conventional loans often accept the most recent tax return only.

A Jumbo is a mortgage loan that exceeds the limits set by the Federal Housing Finance Agency (FHFA). They are considered non-conforming loans because they don’t conform to these $$ limits. 

For 2023, the conforming loan limits are $726,200 for a single-family unit in most parts of the country but can go as high as   $1,089,300 depending on the county.  

Typical Jumbo borrowers will need

• Reduced debt to income ratios
• Higher asset requirements
• Higher credit scores
• Larger down payments

Each individual lender has their own specific underwriting guidelines. 

VA mortgage loans are one of the best loan products on the market. Veterans typically have access to lower rates than conventional, especially on a 30 yr fixed loan.   

• Veterans can do $0 down on a new home purchase up to $2M
• Sellers can pay up to 4% of closing costs
• Higher allowable threshold for debt-to-income ratios than other loans
• Many VA Mortgages are assumable and have NO monthly PMI regardless of down payment
• Jumbo VA loan sizes can go over the county limit with a down payment. 

Federal Housing Administration (FHA) - insures the loan, so your lender can offer you a better deal. FHA allows a buyer to purchase a home with as little as 3.5% down. They tend to be more lenient on areas such as credit, funds to close and co-borrowers.

Some benefits of FHA loans are:

• Low down payments
• Low closing costs
• Easy credit qualifying

FHA might be just what you need. Your down payment can be as low as 3.5% of the purchase price, and most of your closing costs and fees can be included in the loan. 

FHA loan limits for 2023 range from  $472,030 - $1,089,300 varying by county. 

Home Equity Line of Credit (HELOC) allows homeowners to borrow money against the equity they have in their home and receive that money as a line of credit.

As a homeowner, the money is a line of credit secured by your home that gives you a revolving credit line to use for large expenses such as: 

• Home Improvements or Renovations
• Debt Consolidation
• Increase Financial Flexibility 
• Whatever may come up

 Fixed Interest Rate Loan is a loan where, once the rate is locked in, the interest rate doesn't fluctuate during the term of the loan. This helps borrowers account for consistent future payments.  

• Custom Fixed Terms are available, most common are 8 - 30 years
• Buy a home with as little as 3% down
• Refinance up to 97% of your primary homes value
• Monthly Payment (principal & interest) will remain the same for the life of the loan

Adjustable Rate Mortgages (ARMs) also known as variable-rate mortgages or floating mortgages, are loans with an interest rate that changes. 

• The interest rate may change periodically, following the fixed period, depending on the market.  
• ARMs typically start with a lower interest rate than fixed-rate mortgages but that interest rate doesn't last forever. 

Typical fixed periods of ARMs are 5, 7, or 10 years. During this initial, fixed-rate period, your interest rate won’t change. 

Debt Service Coverage Ratio (DSCR) loans are a newer loan product, specifically designed for investors.  

• Credit score and down payment is important
• Income Metric Required - "Will the long term rental income on this property cover the mortgage payment?" 
• Some lenders accept a lower DSCR ratio while others give a better rate if the property cash flows well.  
• DSCR loans typically come with a higher interest rate and a possible prepayment penalty.