Loan Types

FHA Loan

An FHA loan is a type of government-backed mortgage loan that can allow you to buy a home with looser financial requirements. You may qualify for an FHA loan if you have debt or a lower credit score. You might even be able to get an FHA loan with a bankruptcy or other financial issue on your record

 

FHA loans are available with low down payment options and lower minimum credit score limits, but you’ll also have to pay mortgage insurance.

The option of a low down payment and more lenient credit requirements can make FHA loans particularly attractive for first-time home buyers, although you don’t have to be a first-time home buyer in order to qualify. Here are some benefits of FHA loans:

  • Credit score requirements are lower compared to other loans

  • The option for the seller to contribute up to 6% of the sale price.

  • A parent or relative can be a co-applicant on your loan as a non-occupant.

  • Your lender can accept a lower down payment.

  • You could still qualify for an FHA loan if you have a bankruptcy or other financial issues in your history.

  • MIN FICO- 620

  • MIN DOWN PAYMENT 3.5% down

Eligible Properties

An FHA home loan may be used to purchase or refinance:

  • A family home with 1–4 units

  • A condominium unit

  • A manufactured housing unit (must be on a permanent foundation)

Conventional Loan

A conventional loan is a mortgage loan that's not backed by a government agency. Conventional loans are broken down into "conforming" and "non-conforming" loans

A conventional mortgage loan is a “conforming” loan, which simply means that it meets the requirements for Fannie Mae or Freddie Mac

Conventional Loan Requirements

Down Payment

It’s possible for first-time home buyers to get a conventional mortgage with a down payment as low as 3%. However, the down payment requirement can vary based on your personal situation and the type of loan or property you’re getting:

  • If you’re not a first-time home buyer or making no more than 80% of the median income in your area, the down payment requirement is 5%.

  • If the house you’re buying is not a single-family home (i.e., it has more than one unit), you may need to put down 15%.

  • If you’re buying a second home, you’ll need to put at least 10% down.

  • If you’re getting an adjustable-rate mortgage, the minimum down payment requirement is 5%.

  • MIN FICO- 620

Private Mortgage Insurance

If you put down less than 20% on a conventional loan, you’ll be required to pay for private mortgage insurance (PMI). PMI protects your mortgage investors in case you default on your loan. The cost for PMI varies based on your loan type, your credit score and the size of your down payment.

PMI is usually paid as part of your monthly mortgage payment, but there are other ways to cover the cost as well. Some buyers pay it as an upfront fee included in their closing costs. Others pay it in the form of a slightly higher interest rate. Choosing how to pay for PMI is a matter of running the numbers to figure out which option is the cheapest for you.

If you reach 20% equity as a result of your home increasing in value, you can contact me for a new appraisal so you can use the new value to recalculate your PMI requirement.

 

ARM LOAN

 

Conventional adjustable-rate mortgage (ARM) loans typically feature lower interest rates and Annual Percentage Rates (APRs) during the initial rate period than comparable fixed-rate mortgages

ARMs are easier to qualify for than fixed-rate loans, but you can get 30-year loan terms for both. An ARM might be better for you if you plan on staying in your home for a short period of time, interest rates are high or you want to use the savings in interest rate to pay down the principal on your loan.

Reverse Mortgage

A reverse mortgage is a mortgage loan, usually secured by a residential property, that enables the borrower to access the unencumbered value of the property. The loans are typically promoted to older homeowners and typically do not require monthly mortgage payments

VA Loan

A VA loan is a mortgage loan available through a program established by the U.S. Department of Veterans Affairs (VA) (previously the Veterans Administration). With VA loans, veterans, service members, and their surviving spouses can purchase homes with little to no down payment and no private mortgage insurance and generally get a competitive interest rate.

The VA also offers programs that let you refinance an existing VA home loan or take cash out of your home’s equity

 

  • Up to 100% financing is available with no mortgage insurance.

  • No appraisal needed on VA Streamline Refinance loans.

  • VA rules limit your closing costs.

  • Closing costs may be paid by the seller.

 

What is a VA Interest Rate Reduction Refinance Loan?

If you already have a VA loan, a VA Interest Rate Reduction Refinance Loan (IRRRL) — also known as a VA Streamline Refinance — can help you benefit from a lower interest rate and monthly payments.

  • No appraisal or credit underwriting package is required.

Jumbo Loan

Jumbo mortgages are defined as any loan amount that exceeds the base conforming loan limit. For San Diego County, the limit is currently $879,750 for 1 unit single-family home

PRIME JUMBO MAX (30-YEAR FIXED)

PRIME JUMBO INTEREST ONLY (30-YEAR FIXED)

PRIME JUMBO ARMS (5-, 7- AND 10-YEAR)

 

PRIME JUMBO (15- OR 30-YEAR FIXED)

 

·        Loan amounts starting at $1 over the county loan limit

·        No MI required

  • Loan amounts up to $3M

  • 680+ FICO and up to 45% DTI

  • Up to 89.99% LTV and no MI required

  • Eligible on primary, second and investment properties for purchases, rate/term and cash-out refinances

  • One appraisal required for purchases up to $3M and refinances up to $2M*

  • Two appraisals from two different appraisers required for refinances over $2M*

 

Closing Costs

Closing costs are fees that must be paid when the property title is transferred from seller to buyer.

WHAT DO THEY COVER?
Costs differ based on location, property and loan type. Some of these costs could include fees for the application,
appraisal, home inspection, property taxes (taxes due within 60 days of purchase), underwriting & more.

HOW MUCH ARE THEY?
Usually between 2-3% of the home purchase price

One-Time Closing Costs for Buyers

Many closing costs are nonrecurring, in that they must be paid just once. Buyer's closing costs that are one-time charges include:

  • Title policies

  • Escrow or closing fees

  • Tax service fees

  • Notary fees

  • Wire fees

  • Courier/delivery fees

  • Attorney fees

  • Endorsements

  • Recording fees

  • State, county, or city transfer taxes

  • Home protection plans

  • Lender fees paid along with the loan on the loan estimate