Money Saving Mortgage Options
Have you ever wondered what type of mortgage options you have that would minimize the down payment required? One of the biggest “American Dreams” is to own our own home. It is such a great time to buy right now with interest rates being so low, however, during this COVID pandemic, the reality for many Americans is that they have had to tap into their down payment savings making it difficult to do so. I would encourage you to reach out to a reputable mortgage lender to discuss your options!
As a Buyer’s Specialist, I do see lots of different types of mortgage options. Here are a few
First Option – VA Loan
This is a loan option for eligible active US Service members, surviving spouses and veterans. This is a great option for those who are or who have served our country and their family. This is a no down payment mortgage and does not require mortgage insurance. As a daughter of a Vietnam vet I love this option as a benefit for the sacrifices made for our country. THANK TO ALL YOU VETERANS!!!
Second Option – USDA loans
- The second option I would like to tell you a little about are Rural Housing Loans which are more commonly known as USDA loans.
This is a ZERO down payment option for qualified properties located in USDA defined rural areas. Growing up in a rural Iowa farm community I know many friends and family who have been able to take advantage of this type of mortgage. These mortgages are insured by the US Government. You would just need to check with a reputable mortgage lender to see if a property you are interested in might qualify.
Final options -FHA and Conventional loan with Down Payment assistance
- The last two options I would like to tell you about are FHA and Conventional loans with Down Payment Assistance programs
The Federal Housing Administration or FHA mortgage is a great option for buyers as HUD insures the loan which helps your lender to provide you with a lower out of pocket cost option. Typically the down payment for an FHA loan is 3.5% of the purchase price, however, with down payment assistance that portion can be forgiven. The down payment assistance program is really a grant that is given for up to the 3.5% down payment required. The stipulation to have that forgiven is that you make 36 consecutive on time payments and the property must be occupied by the owner.
The Conventional loan product is one in which competitive interest rates are offered due to fair to good credit scores. These typically require a 3 to 5% down payment but with a grant program that might be available to you, that could possibly be forgiven similar to the FHA Down Payment Assistance program. Again, a lender would be able to tell you if this is an option for you.
These are a few options that could help you make your dream of owning a home a home a reality. IF you have more questions I’d be happy to introduce you to a reputable lender. It’s always a good idea to talk with your lender about the options that are available to you. Government programs can change or more can become available and a lender will have all the latest and most current information.