loan types

A purchase transaction includes buyers, sellers, and real estate agents representing each side. The financed portion of the funds use to buy a home is called a purchase mortgage loan.

A Pre-Approval Letter is generally required before searching for homes to help guide you and the realtor how much you can afford.

A rate and term refinance is a type of loan that replaces your old mortgage with a new one for more favorable terms.

This is a great option if you want to:

• Lower your monthly mortgage payment

• Pay off your mortgage faster

• Change from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage or vice versa

A cash out refinance is a type of mortgage loan that allows you to borrow more than you currently owe on your mortgage and take the difference out in cash.

This is great option if you need money for:

• home improvements

• debt consolidation

• other expenses

A home equity loan and a home equity line of credit (HELOC) are both types of loans that allow homeowners to borrow money against the equity in their homes.

Equity is the difference between the market value of the home and the outstanding mortgage balance.

Home Equity Loan:

• One-time loan

• Fixed amount of money

• Fixed interest rate

• Fixed repayment term

• Benefits: Finance major expenses - home improvements, education, or debt consolidation.

Home equity line of credit (HELOC):

• Revolving line of credit

• Variable interest rates

  • Interest rate on the loan can fluctuate over time.

• Benefits: Financing unexpected expenses - repairs, medical bills, or emergency travel.

Down payment assistance (DPA) is financial help that can be used to cover the down payment and/or closing costs on a home purchase.

DPA can come in the form of grants, loans, or forgivable loans.

It is typically available to first-time homebuyers and low- to moderate-income borrowers.

A renovation loan is a type of loan that is specifically designed to finance home renovations. Renovation loans can be used to cover the cost of a wide range of projects, including:

• Kitchen and bathroom remodels

• Additions

• Roof repairs

• Energy efficiency upgrades

• Landscaping

• Accessibility modifications

There are two types of renovation loans:

• FHA 203(k) loans

• Fannie Mae Homestyle loans