There are a number of different types of home loans available to you, and it can pay to familiarize yourself with them. Luckily we're here to help you choose the best type of home loan for your needs.
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The most common type of loan option, the traditional fixed-rate mortgage includes monthly principal and interest payments which never change during the loan's lifetime.
Adjustable-rate mortgages include interest payments which shift during the loan's term, depending on current market conditions. Typically, these loans carry a fixed-i...
Interest only mortgages are home loans in which borrowers make monthly payments solely toward the interest accruing on the loan, rather than the principle, for a specif...
A conventional loan is a type of loan that is not insured by the government. Conventional loans offer more flexibility and fewer restrictions for borrowers, especially those borrowers with good credit and steady income.
FHA home loans are mortgages which are insured by the Federal Housing Administration (FHA), allowing borrowers to get low mortgage rates with a minimal down payment.
VA loans are mortgages guaranteed by the Department of Veteran Affairs. These loans offer military veterans exceptional benefits, including low interest rates and no ...
A jumbo loan is a mortgage used to finance properties that are too expensive for a conventional conforming loan. The maximum amount for a conforming loan is $766,550 in...
USDA loans are low-interest mortgages with zero down payments designed for low-income Americans who don't have good enough credit to qualify for traditional mortgages. You must use a USDA loan to buy a home in a designated area that covers several rural and suburban locations.
A second mortgage is a loan secured by your home that is subordinate to your primary (first) mortgage. It allows homeowners to borrow against their home equity while keeping their original mortgage intact. A fixed-rate 2nd mortgage is a loan with a predetermined interest rate that remains constant throughout the entire loan term. This means that your monthly mortgage payments will also remain the same, providing predictability and making budgeting easier. A 2nd mortgage loan can be used to finance the purchase of a property or use the equity in your home for anything that you choose. Fixed-rate mortgages are typically available for terms of 10, 15, 20, or 30 years.
A home equity line of credit, also known as a HELOC, is a line of credit secured by your home that gives you a revolving credit line to use for large expenses or to consolidate higher-interest rate debt on other loans such as credit cards. This is a 2nd lien on your property that will allow you to borrow exactly what you need, typically for lower rates than other forms of credit, and you only pay interest on what you borrow. A HELOC is a variable interest rate that adjusts when the Prime Rate adjusts so your payments can increase or decrease depending on the current market conditions. Typically, during the first 10 years you have access to the credit line up to the credit limit called the "draw period". This gives you the ability to draw against the line or pay the line down. Once the draw period is completed it will convert to a repayment schedule typically requiring the amount due at that time to repay the amount owed within a 20-year period. .
