Below is a brief explanation of some of the most commonly used loan programs. Consult your Loan Officer for further details:
Conventional
Fixed Rate Mortgage - A loan that has an interest rate that remains constant throughout the life of a loan.
ARM - Adjustable Rate Mortgage - A loan that has an interest rate that increases or decreases at specified times during the life of a loan. The change in the interest rate is tied to a financial index.
Balloon Loan - A fixed rate loan that is amortized over a 30-year period but becomes due and payable at the end of a certain term (5, 6, 7 or 10 years). May be extendible or may rollover into another type of loan.
Buy down - A fixed rate loan where the interest rate and payment are reduced for a specific period of time by paying the interest up front to subsidize the lower payment.
Government Loan Programs
AEOA Home Buyer's Program - A government sponsored home buyers assistance program that helps buyer's with their down payment or closing cost s. The program can be used with a variety of financing options. Subject to borrower meeting income limits and completion of an AEOA training class on home ownership.
FHA Loan - FHA loans are available as a fixed rate, ARM or Buy-down. They are loans that are insured by the Federal Housing Administration and offer low down payments and higher qualifying rates. There is a maximum FHA loan limit that varies from region to region.
VA Loan - A no down payment loan available to eligible veterans. VA loans are insured by the Department of Veteran's Affairs. The maximum VA loan is currently $203,000 (including the funding fee) with no down payment.
For questions on these and other loan programs, please feel free to contact one of the following local lenders:
