Are you buying a home?
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The Lender Ace has dozens of lenders and loan programs to choose from to best fit your needs. The type of loan you can get is driven by many factors, including down payment, credit and monthly income. We will help you select the best program to fit your personal situation. The most common loan types are:
Conventional/Conforming – This loan can accommodate many borrowers. The general maximum loan limit for a conforming loan is $417,000.00 but many counties have a higher limit based on their average home price. In Utah the high limits for a conforming loan for a single family home for Summit, Tooele and Salt Lake Counties for 2009 is $729,750.00. All other Counties in Utah have a limit of $417,000. The traditional minimum down payment for a conforming loan is 5%, but options exist to accommodate a lower down payment if necessary. These loans require mortgage insurance unless the borrower provides a down payment of at least 20%, but split mortgages (a first mortgage combined with a second mortgage or Home Equity Line of Credit) such as 80/20 and 80/15 can be done to eliminate the requirement for mortgage insurance.
FHA – FHA loan programs are wonderful for buyers who don’t quite qualify for a conforming loan and, in some cases, are even better for a borrower than a comparable conforming loan because they provide significant flexibility. They allow the borrower to have higher debt and a lower down payment than many other loan programs (3.5 percent). FHA loans have traditionally had a lower maximum loan amount than conforming loans, but the recent economic programs have changed this and they are now the same as maximum loan amounts for conforming loans.
VA – This loan is reserved for use by veterans of military service. Active duty, retired, and reservists are eligible depending upon length of service and status of discharge. A Certificate of Eligibility is required, which your loan officer can help you obtain with a copy of your DD214. This loan can provide 100 percent financing for the purchase of a home and does not require any monthly mortgage insurance, a common requirement of other low-down-payment loans.
Construction Loans – These loans are an interim source of financing that is used while constructing a new home. Funds are made available on a “Draw” basis to pay for the construction as the home is being built. A long-term loan is pre-approved and available upon the completion of the home, and will pay off the construction loan once the home is finished. This loan can often be obtained in either the borrower’s name or the contractor’s name. Also available are one-time-close construction programs in which the long-term financing and construction loans are closed at the same time.