In your search for a mortgage you may have asked yourself and others “What is the best loan product for me?” Well the answer to that question depends on a lot of variables. Variables such as how long you plan to stay in the home, your age, your tolerance for risk, etc.
Before answering that question you should know about the different loan products that are available. Here is a summary of six loan programs with a basic description:
- Fixed Rate Mortgages - A fixed rate and fixed payment for the life of the loan.
- ARM Mortgages - Rate and payment can adjust. There are many variations of this loan product.
- Jumbo Loans - This product is for loan amounts that are larger than the Freddie Mac and Fannie Mae loan limits.
- FHA Loans - Requires only a 3.5% down payment and is insured by the Federal government.
- VA loans - A loan product available to Veterans.
- 203K Loans - A loan that finances both the home and the cost of improvements.
Now that you know about the different loan products, here are some tips to help you make a choice:
- If you need a loan amount more than $625,500 and can or will have at least 10% equity in the property, you will most likely need a jumbo loan.
- ARM mortgages might make sense for the young couple without children who know they will need to buy a bigger home down the road after they have started having children.
- FHA loans are assumable. If you have a below market interest rate when you sell the home, the rate can help attract buyers!
- Fixed rate mortgages are attractive to those who like to "set it and forget it"
- VA loans allow for the spouse of the Veteran to help qualify.
- Instead of competing for the house that everyone loves and will receive multiple offers, make an offer on the house tht needs work utilizing the 203k loan.
There is not one best loan product. Consult with your Loan Officer and determine which one best suits your needs!
Would you like to talk to Phil - call or text (650) 222-0386
Phil Caulfield NMLS #386911 has been helping people obtain mortgages since 1985. The views, articles, postings, and information listed at this website are personal and do not necessarily represent the opinion or the position of Cardinal Financial LLC.