10/11/2020
Let’s talk about loans baby!!! Swipe for more information 👆🏾!
Fixed Rate Loan:
One type of fixed-rate mortgage is a jumbo loan. For this loan, you will pay the same interest rate for the full repayment term. This means the monthly payment will never change, even for long-term financing. The interest rates on fixed-rate loans typically are higher than adjustable-rate loans.
Adjustable Rate Loans:
Many ARM loans have a fixed interest rate for a few years (such as 5 or 10 years) before the loan changes to a variable interest rate for the remainder of the term. The initial interest rate of the ARM loan is often less than the rate you would get with a fixed-rate loan for a fixed period. However, at the end of the ARM’s fixed period the interest will fluctuate with the market and if interest rates are high your monthly mortgage payments may become unaffordable.
VA Loans:
VA loans are offered to military service members and their families and backed by the U.S. Department of Veterans Affairs. Should a borrower default, the VA will reimburse the lender for any losses. To qualify for a VA loan, borrowers need suitable credit, sufficient income, and a valid Certificate of Eligibility. To obtain the Certificate, the borrower, or their spouse, must not have received a dishonorable discharge and must meet specific service requirements. Also, borrowers can receive up to 100 percent financing.
FHA Loans:
Backed by FHA, these types of home loans help make homeownership possible for borrowers who do not have a large down payment saved up and do not have the best credit. Borrowers need a minimum FICO score of 580 to get the FHA maximum of 96.5 percent financing with a 3.5 percent down payment; however, a score of 500 is accepted if you put at least 10% down.
