Discover What Mortgages Could Work for You
Want to know what options you have for mortgages as a home buyer in the Triangle area? Check out some of the most common mortgages that are used by buyers in this area. In order to determine the best loan that will work for you, make sure you do your research—there are a ton of loans out there that will work for your budget! To prepare for your upcoming investment, contact local banks to determine what kind of loans you could qualify for. Reach out to your local Realtors as well, the Hunt for Homes team is ready to be of assistance!
Common Triangle Mortgage Options
Conventional loan
- This type of mortgage option is one of the most common types offered by lenders.
- Conventional loans are available to homebuyers through a private lender like Fannie Mae and Freddie Mac.
- Ideal for buyers with a solid credit score and little debt
- Down payments as low as 10 - 20% as a min are available with a conventional loan.
VA loan
- A VA loan is backed by the U.S. Department of Veterans Affairs. This is a specific type of loan for those who have served in the military and/or currently serving.
- Family members of service members may also be eligible for this type of loan.
- With a VA loan, homebuyers are able to put down as little as 0% for a home.
- VA loans can also be used to refinance a mortgage to help to purchase their primary residence.
FHA loan
- This type of loan is insured by the Federal Housing Administration.
- An FHA loan allows for down payments as low as 3.5%.
- The difference between these loans and the conventional loan is that this loan is backed by the federal government where a conventional loan is not.
- Lenders will have different qualifications when determining what sort of loan to grant to homebuyers.
USDA loan
- In order to qualify for a USDA loan, properties must be in a designated, eligible rural area.
- This type of loan as little as no down payment.
- Targeted towards middle-income buyers with lower credit scores
- USDA loans are backed by the U.S. Department of Agriculture in an effort to create strong communities and a better quality of life.
Balloon mortgage
- A large portion of the borrowed principal is repaid in a single payment near the end of the loan period.
- Balloon mortgages typically have a 5 to a 7-year loan with payments based on a 30-year loan.
- After your 5 to 7 years of low payments, then you would need to pay off, sell, or refinance the rest.
- You may have to pay an interest-only monthly payment, and it usually is a lower rate.
Fixed-Rate Mortgage
- This option allows for homeowners to have a fixed interest rate over the duration of the loan
- A constant interest rate is very appealing to many homebuyers as this can save lots of money if interest rates climb
- This can be a great option for those who need a predictable amount to pay each month.
Lender-specialty loans
- A specialty loan are loans with special interest rates, fee exemptions, or incentives for first-time buyers
- This type of loan allows borrowers who have unique characteristics still be able to qualify for mortgages using non-traditional methods.
- Typically, these loans are special offers by each individual bank.
- There is often a 30-year fixed leverage term.
Adjustable-Rate Mortgage
- Often this type of mortgage works by entering into the loan with a lower rate that stays the same for a couple of years.
- At the end of the term, the rate will then adjust to the current market rate.
- This is a good option if interest rates are extremely high but you think they would drop in a few years.
- The amount that you can pay for the first few years ranges from 5 to 10 years depending on your lender and your qualifications.
Ready to Determine Your Monthly Mortgage Payments?
Utilize our mortgage calculator to estimate the amount of money you would need to budget for various home price points. You can use this tool to also calculate interest rates, down payments, insurance, and any tax costs. Reach out to our team if you have questions about a payment that would work with your budget!