USDA / RURAL Housing

“Rural Development” home loans are given to qualified borrowers seeking to buy or refinance a home in a rural location. These loans are government insured by the USDA, and are typically for low to middle income households buying a home for primary residence. USDA loans have special features that differ from conventional loans which attract buyers who have typically been denied for other loans, yet still are looking for a way to afford a home. There is no down payment, in addition there is minimal mortgage insurance compared to FHA.

“Quick Facts About USDA/Rural Housing Loans”

• ​“Rural Development” home loans are given to qualified borrowers seeking to buy or refinance a home in a rural location.
• These loans are government insured by the USDA, and are typically for low to middle income households buying a home for primary residence.
• USDA loans have special features that differ from conventional loans which attract buyers who have typically been denied for other loans, yet still are looking for a way to afford a home.
• With a USDA Loan, no down payment is required, and the loan carries low minimal mortgage insurance, as opposed to FHA loans.

Conventional Loans

These are mortgages that follow the guidelines set by Fannie Mae and Freddie Mac. There are Fixed Rate Mortgages (FRM’s) & Adjustable Rate Mortgage (ARM’s). Typically ARM’s will have a lower interest rate but are a little more risky due to the rate not being fixed for the life of the loan. All conventional mortgages payments are due on the 1st of the month with a 15 day grace period. No prepayment penalty. The current max loan limit for conventional mortgages is $510,000. The minimum down is 3.00% but ideally starting with 5% down. When borrowers pay less than 20% down, mortgage insurance (MI/PMI) is required, and a fee is added to your payment each month.

​Terms for the Fixed Rates are 5, 10, 15, 20, 25 & 30 years. ARM’s will be fixed for a specific time period (3, 5, 7 or 10 years) amortized (calculated) over 30 years. Once the initial fixed rate time period is over they become adjustable rates for the remainder of the term. There are caps to how high the rate can go once the fix rate period is over.



“Quick Facts About Conventional Loans”

• ​“Conventional” mortgages follow the guidelines set by Fannie Mae and Freddie Mac.
• Conventional loans come in two types: Fixed Rate Mortgages (FRM’s) & Adjustable Rate Mortgage (ARM’s). Typically, ARM’s will have a lower interest rate but are a little riskier due to the rate not being fixed for the life of the loan.
• All conventional mortgages payments are due on the 1st of the month with a 15-day grace period.
• Conventional loans carry No prepayment penalty for early repayment of the loan.
• The current max loan limit for conventional mortgages is $510,400. The minimum down is 3.00% but ideally starting with 5% down. When borrowers pay less than 20% down, mortgage insurance (MI/PMI) is required, and a fee is added to your payment each month.
• Terms for the Fixed Rates can be arranged for 5, 10, 15, 20, 25 or 30 years.
• ARM’s will be fixed for a specific time period (typically 3, 5, 7 or 10 years) amortized (calculated) over 30 years. Once the initial fixed rate time period is over they become adjustable rates for the remainder of the term. “Caps” apply limit how high the rate can go once the fix rate period is over.

FHA Loans

An FHA loan is a mortgage insured by the Federal Housing Administration (FHA). FHA loans are designed for low-to-moderate income borrowers who are unable to make a large down payment or someone who has marginal credit.   The 3.5% down payment requirement can come from the buyer or a gift from family, which makes FHA loans popular with first-time homebuyers but not limited to first-time homebuyers. It can also be used as a refinance program. Even people who have no credit or have gone through bankruptcy and foreclosure may still qualify.  Borrowers can pay off an FHA mortgage early with no penalty. 

​FHA program does include 203k home improvement loans & REVERSE MORTGAGES which both can be used for a purchase or refinance.

“Quick Facts About FHA Loans”

• An FHA loan is a mortgage insured by the Federal Housing Administration (FHA).
• FHA loans are designed for low-to-moderate income borrowers who are unable to make a large down payment or someone who has marginal credit.   
• The 3.5% down payment requirement can come from the buyer or can come from a gift from family, which makes FHA loans popular with first-time homebuyers (although not limited to first-time homebuyers.) 
• FHA loans also can be used as a refinance program. 
• Even people who have no credit or have gone through bankruptcy and foreclosure may still qualify. 
• Borrowers can pay off an FHA mortgage early with no penalty. 
• The FHA program also can include 203k home improvement loans & REVERSE MORTGAGES (both can be used for a purchase or refinance).

VA Loans

This might be the best program available to a consumer. No money down plus there is NO mortgage insurance. The United States Department of Veterans Affairs established this program to help veterans and their families obtain home financing. The Department of Veterans Affairs established the rules for those who may qualify, dictates the terms of the mortgages offered and insure VA loans against default. VA loans offer up to 100% financing on the value of a home. To qualify for a VA loan, borrowers must present a certificate of eligibility, which establishes their record of military service. Borrowers can pay off a VA mortgage early with no prepayment penalty.

“Quick Facts about VA Loans”

• The United States Department of Veterans Affairs (VA) established this program to help veterans and their families obtain home financing.
• The Department of Veterans Affairs established the rules for those who may qualify, dictates the terms of the mortgages offered and insure VA loans against default.
• VA loan programs might be the best program available to a consumer.
• VA loans require no money down, AND no mortgage insurance is added to your payments.
• VA loans offer up to 100% financing on the value of a home.
• To qualify for a VA loan, borrowers must present a certificate of eligibility, which establishes their record of military service. 
• Borrowers can pay off a VA mortgage early with no prepayment penalty.