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There are
a lot of different Lenders that offer different types
of loans. They all base their loan guidelines on the
3c's (discussed under Qualifying)
which are Capacity to Pay, Collateral and Credit. A
level of risk (statistically, the more likely the borrower
will not repay the loan in a timely manner) is determined,
and lending guidelines are assigned. The higher the
risk, the higher the interest rate. The Lenders can
be grouped into the following categories:
Conventional
These are loans subsidized by two large stock-owned
corporations, Freddie Mac
and Fannie Mae. They
do not lend money directly to home buyers. Instead,
work with lenders to ensure a continuous supply of funds
are available. Both of these corporations were orginally
chartered by Congress to stabilize the nation's mortgage
markets and expand opportunities for homeownership and
affordable rental housing in America. Loans over 80%
loan
to value include an additional cost known as Mortgage
Insurance.
Click here for Eligibility requirements.
| Purchase
Loan |
| Loan
Amount |
$0-322.700 |
| Down
Payment |
5% or
More (3% option also avail) |
| Amortization
Term |
10-30
years |
| Loan
Type |
Fixed
and Adjustable Rates |
| Refinance
Loan |
| Loan
Amount |
$0-322,700 |
| Rate
& Term Refinance |
up to
95% of Property Value |
| Cash-Out
Refinance |
up to
90% of Property Value |
| Bill
Consolidation |
up to
90% of Property Value |
| Amortization
Term |
10-30
years |
| Loan
Type |
Fixed
or Adjustable Rates |
| Conventional
Loan Limits |
| Single
Family Home |
$322,700 |
| 2 Units
/ Duplex |
$413,100 |
| 3 Units
/ Triplex |
$499.300 |
| 4 Units
/ Fourplex |
$620,500 |
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Government
FHA
(Federal Housing Administration) is inusured by
the Department of Housing and Urban Development (HUD).
These funds are provided to FHA approved Lenders, not
given directly to the public. Loan guidelines tend to
be more lenient than Conventional
(low downpayment requirements and a higher monthly debt
allowance). However, limits are placed on the loan amounts,
based on the location of the property. Loans
over 80% loan
to value include an additional cost known as Mortgage
Insurance.
Click
here for Eligibility requirements.
| FHA
Purchase Loan |
| Loan
Amount |
Check
with your local HUD office |
| Down
Payment |
3% or
less |
| Amortization
Term |
15 and
30 years only |
| Loan
Type |
Fixed
and Adjustable Rates |
| FHA
Refinance Loan |
| Loan
Amount |
Check
with your local HUD office |
| Rate
& Term Refinance |
up to
97% of Property Value |
| Cash-Out
Refinance |
up to
85% of Property Value |
| Bill
Consolidation |
up to
85% of Property Value |
| Amortization
Term |
15 and
30 years only |
| Loan
Type |
Fixed
or Adjustable Rates |
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VA
(Veterans Administration) mortgage are insured by
the US government. FHA and VA is insured by the Department
of Veterans Affairs (DVA).
The biggest advantage here is the ability to finance
a purchase with no-money down. However, VA loans are
restricted to individuals qualified by military service.
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Sub
Prime
These are
loans from Lenders catering to those who don't qualify
through Conventional or Government programs. In addition
they offer loan programs with no-money downpayments,
and do not require Mortgage
Insurance premiums.
|
Self
Employed
Stated
or EZ
documented income for borrowers with difficulty
verifying their income for the last 2 years.
|
Credit
Difficulties
Borrowers with a history of late payments, loan
default or bankruptcy |
Unstable
Income
Borrowers with unstable employment or infrequent
/ variable income |
Lack
of Savings or Downpayment
Borrowers wishing to finance more than 90-95% of
Property values. |
Non-Resident
Aliens
|
|
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Jumbo
Loans
These are
loans which exceed the conforming loan limits. See the
reference chart below for loan sizes: Both Conventional
and SubPrime Lenders offer Jumbo Loan programs.
| Jumbo
Purchase Loan |
| Loan
Amount |
$300,701
- $1,202,800 |
| Down
Payment |
5% or
more |
| Amortization
Term |
10 years
- 30 years |
| Loan
Type |
Fixed
and Adjustable Rates |
| Jumbo
Refinance Loan |
| Loan
Amount |
$300,701
- $1,202,800 |
| Rate
& Term Refinance |
up to
95% of Property Value |
| Cash-Out
Refinance |
up to
90% of Property Value |
| Bill
Consolidation |
up to
90% of Property Value |
| Amortization
Term |
10 years
- 30 years |
| Loan
Type |
Fixed
or Adjustable Rates |
(Top
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