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Financing Guide

There are many financing options available for homebuyers, each with its own unique advantages. Basically, a mortgage is simply a loan you obtain to buy a house and pay back over a set period of time, while a lender is a term applied to mortgage brokers, banks, and other financial institutions that provide you with the funds you need in order to purchase your home. There are many kinds of mortgages, so it’s recommended to choose the financing that suits you the best:

Fixed-Rate Mortgages. You should consider this type of mortgage if you plan to live in your new home for many years and prefer to pay the same amount each month. Fixed-rate mortgages are for 15 or 30 years, and guarantees that the monthly payment remains the same for the life of the loan. Ideal for those who don’t like risks.

Adjustable Rate Mortgages. Also known as ARMs, these have interest rates that are adjusted at specific time intervals to reflect the current market, making your mortgage increase or decrease. If your income isn’t sufficient enough to cover the maximum payments required, then it’s best to choose another type of mortgage.

Convertible Adjustable Rate Mortgages. Convertible ARMs are a combination of fixed and adjustable mortgages. The rate will stay fixed for the first three, five or seven years, and then will be adjusted annually for the duration of the loan. Recommended if the initial interest rate is low and the future rate is not guaranteed.

Government Loans. This type of loan requires certain conditions to be met with regards to the property or the buyer; if you meet those conditions, then you might want to consider this option. Government loans have much better interest rates, but you might want to check the terms carefully because they maycontain a back-end clause that requires you to pay a percentage of the sale price back to the government.
FHA Loans. The Federal Housing Administration (FHA) offers loans for lower-income Americans. While down payments are lower, there’s usually a cap on how much can be borrowed. FHA mortgage limits also vary by community, so it’s best to consult with your Realtor first to find out more about your options with this type of loan.

VA Loans. Eligible veterans may qualify for a loan from the Department of Veterans Affairs (VA). No down payment is required, and there’s no monthly premium for mortgage insurance, but there is a funding fee, which may be financed.

Contact Info

Amy Biernacki
Amy Biernacki
T: (954)709-5647
F: (888)270-2749
About Amy