Personal
Mortgage Loan Options
Financing a home can often be as overwhelming as it is exciting. But it doesn’t have to be stressful if you understand your loan options. Whether you’re buying, building or refinancing a home, take advantage of available resources — hint, hint: like our Loan Officers — to help you choose the best mortgage option for your situation.
For starters, you’ll want to identify the type of loan that will best fit your goals. Keep reading for an overview of the benefits and considerations of each loan type to help you choose the best option.
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Conventional fixed-rate loans
The most common loan type, the interest rate is the same for the entire life of the loan.
Key benefits
- Monthly payments are always the same
- Rate never changes
- Consistent amount for budgeting
Worth considering if you…
- Want to pay the same amount every month
- Have a fixed or steady income
- Plan to stay in your home long-term
Adjustable rate loans
Also known as an ARM, the interest rate is periodically adjusted up or down based on a market index.
Key benefits
- Initial interest rate is usually lower than a fixed-rate loan
- Payment amount can change (up and down)
- Generally the lowest, short-term rate
Worth considering if you…
- Need a lower interest rate
- Can manage a fluctuating payment amount
- Plan to be in the home for a short period of time
FHA Loans
Low down-payment option with more lenient requirements for qualification.
Key benefits
- Typically available with a low down payment
- More lenient lending requirements
- Available for those with less-than-perfect credit
Worth considering if you…
- Are unable to make a large down payment
- Don’t have perfect credit
- Have higher expenses compared to income
VA (Veterans Affairs) Loans
Low down-payment loan option available to veterans and active military members.
Key benefits
- Typically does not require a down payment
- Does not require mortgage insurance
- Lower credit score requirement
Worth considering if you…
- Are a veteran or active member of the military
- Prefer not to make a down payment
- Don’t have a high credit score
Jumbo Loans
Conventional loan amount that is higher than the standard mortgage loan limit.
Key benefits
- Increased purchase limits for higher-priced properties
- Higher single loan amount doesn’t require multiple smaller loans
- Flexibility in loan terms
Worth considering if you…
- Need a loan amount greater than $510,400 (in most states)
- Have an established credit history
Key benefits
- Fixed rate
- Low monthly payments
- Extended repayment options
Worth considering if you…
- Want to renovate your home, pay for education or purchase a vacation home
- Need to consolidate high-interest debt
- Plan to make a major purchase
Home Equity Line of Credit
A revolving line of credit you can use when you need it, similar to a credit card.
Key benefits
- Interest rate is adjustable, and usually lower than unsecured credit
- Quick access to funds, once approved
- Interest-only payments during draw period
Worth considering if you…
- Want a home equity loan, but don’t need the funds in a lump sum
- Like to have access to money “just in case”