Find Your Mortgage Match

Finding the right mortgage is a lot like finding a romantic partner – you want a loan you find honest and attractive, won’t cause you stress, and reliable enough to help you build security. And just like dating, you can even find your mortgage through a phone app! With that in mind, let’s look at what each loan program brings to the table in hopes of finding your mortgage match!

Conventional (But Never Boring!)

Conventional loans are like that quarterback or head cheerleader – popular and charismatic, but occasionally clique-y with those who have better credit scores and income. Conventional offers the most loan options because it’s not backed by a government program. Instead, your loan just has to meet the requirements of Fannie Mae and Freddie Mac“Government-sponsored entities" (GSE) that manage the flow of credit to the U.S. economy’s housing sectors.Fannie Mae and Freddie Mac“Government-sponsored entities" (GSE) that manage the flow of credit to the U.S. economy’s housing sectors.. To partner with Conventional, you don’t need the 20% down payment you might think. There are Conventional programs that only require 3-5% down. Conventional is not afraid of commitment, so it will underwrite and close faster. It likes borrowers of all sizes, and if you have mortgage insurance (MI) “baggage,” you can cancel it once you reach 80% loan-to-valueThe difference between the loan amount and the home’s market value. This helps lenders assess loan risk.loan-to-valueThe difference between the loan amount and the home’s market value. This helps lenders assess loan risk.!

FHA: Eager to Meet Buyers of All Ages and Incomes

Don’t have much money saved up? Credit score on the lower side? First-time homebuyer? FHA’s got you, baby! Insured by its parents, the Federal Housing Administration, FHA only requires 3.5% down (but will give you 100% satisfaction). It’s very forgiving of past financial mistakes. However, because FHA can be a little needy (it requires MI for the life of the loan), short-term dating might be better until your financial picture improves. After that, maybe you can refinance to give Conventional a try.

VA: Seeking Service Members and Spouses

Department of Veterans Affairs (VA) loans may sound tough, but they’re actually quite friendly to Veterans, active-duty service members, and their spouses. VA loans are also backed by the U-S-of-A and come with no down payment and no mortgage insurance, just a one-time, upfront funding fee that can be rolled into the loan. Better yet, if you have full entitlement, you won’t have any loan limits! VA is loyal, so you can use it no matter how many homes you buy in your lifetime.

USDA: Not Just for Farmers Only

You know that “best friend” in the rom-coms that everyone misunderstands until the end when they finally win over their love interest? That’s the United States Department of Agriculture (USDA) loan. Also named “Rural Development” (but that’s for fancy folks - just call it “RD”), USDA loans are not just for farmers or country communities. The rough rule of thumb is if your area has under 20,000 people, USDA might be perfect for you. USDA can be a bit picky since it only allows primary homeowners whose income falls under certain limits, but it is generous, requiring no down payment. And although USDA requires annual MI (“guarantee fee”), that .35% of the loan amount is typically less than what you would pay for in Conventional MI. Some say love is blind, but you need your eyes wide open when you’re ready to make a mortgage match. We can help. Call us today to get started!