Know your mortgage options
Mortgage options
Find a loan to fit your budget and your financial goals.
Conventional mortgages
Simply put, a conventional mortgage is a loan that's not backed by a government agency such as the Federal Housing Administration (FHA) or Veteran Affairs (VA).
There are two types of conventional loans: conforming and nonconforming. Conforming loans follow lending rules set by the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). When a loan doesn't follow these lending rules, it's considered non-conforming. There are a number of factors that may cause a loan to be non-conforming, generally loan amount is a key factor.
Things to consider:
While a 30-year, fixed rate mortgage is a popular conventional loan, you have other options such as a 15-year fixed rate loan or a 7/1 ARM to name a few. Think about your current budget, as well as your longer-term financial goals as you plan. Our mortgage calculators can help you get there.
Mortgages with lower down payments
A DreaMaker mortgage has down payment options as low as 3% and lower monthly payments with a 30-year fixed rate.
Things to consider:
You'll need to meet income requirements to qualify for this loan.
An FHA mortgage is a government-insured loan that offers down payments as low as 3.5%. FHA loans come with a 15-, 20-, 25- or 30-year term and have a fixed interest rate.
Things to consider:
While there are no specific income requirements to qualify, you will have to pay monthly mortgage insurance for the duration of the loan and a mortgage insurance premium at closing.
A VA loan has low or no down payment options and no mortgage insurance requirement. VA loans are available with 10-, 15-, 20-, 25- or 30-year terms.
Things to consider:
You or your spouse must be a veteran, active duty service member or a member of the National Guard or Reserve to qualify for a VA loan.
Mortgages for higher priced real estate
Jumbo loan
A jumbo loan is a mortgage for larger property. The maximum amount for a jumbo loan may vary and can be higher in larger cites, or for properties with more than 1 unit.
Things to consider:
You need to have a minimum credit score and a certain amount of cash to qualify.
Which loan is right for you?
Consider these factors when deciding which loan is best for you.
Loan options: Which loan is right for you?
Conforming
- Good income, down payment and credit score
- Down payment required: 5-20% - Between 5-20% of purchase price
- Consideration: Strict lender requirements
FHA
- Lower income, down payment and credit score
- Down payment required: 3.5% - As low as 3.5% of purchase price
- Consideration: Monthly mortgage insurance required
DreaMaker
- Smaller or limited down payment
- Down payment required: 3% - As low as 3% of purchase price
- Consideration: Strict income requirements
VA
- Veterans, active service members and their spouses
- Down payment required: 0% - No down payment required
- Consideration: Available to active service members and veterans only
Jumbo
- Great income, down payment and credit score
- Down payment required: 20% - 20% or more of purchase price
- Consideration: Higher fees
