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FHA Loans

FHA loans are government-backed, which allows borrowers to get better interest rates when obtaining a mortgage. In order to be able to pay lenders in case of a loan default, the FHA charges borrowers a mortgage insurance premium of 1.75% of the loan upfront, as well as a monthly fee collected with each payment.

Another tremendous advantage of an FHA loan is the ability to refinance with very limited documentation (including no income, asset documentation, or appraisal) should rates move lower. A refinance will most likely be granted if the borrower has made regular and on-time mortgage payments in the past 12 months and continues to use the property as their primary residence.

Standard FHA loans are available with as little as a 3.5% down payment. A minimum FICO score of 580 is often required (or possibly no FICO score). There are other FHA loan programs that require a minimum FICO score of 550 with a 10% down payment. Our Westlake Village FHA loans offer a number of benefits for those who have experienced credit issues in the past. One of the most significant reasons to get an FHA loan is that it is assumable—that means when you sell your property, the buyer can assume the loan.

FHA Loan Qualifications

Qualifying for an FHA loan is easy. Since the loan is backed by the government, there are lower qualifying guidelines for borrowers, as well as low closing costs and down payments. Here are some figures to keep in mind:
Borrowers often must have a minimum FICO score of 580.
The down payment can be as low as 3.5% of the purchase price.
Gift funds can be used to cover 100% of the closing costs and down payment.
If you meet the minimum credit and financial requirements, it is important to find a lender in your area that can provide you with the best terms and financing. For more information or to apply for an FHA Loan, contact Mack Mortgage today.

VA Loans

VA Loans (Veterans Affairs) are mortgages made by banks but guaranteed by the U.S. Department of Veterans Affairs.

The key aspect of the VA loans is that they allow you to purchase a home without a down payment and without mortgage insurance. A VA loan program, the VA “No-No” Loan is a loan that requires 0% (or “no”) down payment and no (“no”) closing costs. (In purchase transactions, the seller often must pay some closing costs.) Elite Financial is committed to paying these costs up to the limits of the law in order to help veterans purchase a home.

How Does It Work?

You may qualify for a VA loan if you meet any of the following requirements:

You have at least 90 days of consecutive wartime service.
You have at least 181 days of active peacetime service.
You have at least 6 years of National Guard or Reserve service.
You are the spouse of someone who died while in service.

VA loans can be assumable, meaning that a new home buyer can take over the responsibility of the seller’s loan without any change in loan terms. Additionally, VA loans are eligible for streamlined refinancing, which can help lower loan payments quickly without an appraisal, income documentation, or even credit reports. Elite Financial offers VA, as well as FHA, loans for a range of loan amounts; the maximum payment on one’s loan will vary from county to county.

For more information or to apply for an FHA Loan, contact Mack Mortgage today.

Fixed Rate

Fixed-rate loans are considered the safest loans because the rate and payment never change. While rates can be lower on adjustable-rate mortgages (ARM), there is a point in the term of the loan where it converts to an adjustable loan, and the interest rate is subject to yearly changes. Although rates have been low, and adjustments have kept the ARM loans with a lower interest rate, this might not be the case in the future as pundits believe interest rates will rise.

Searching for a new property to buy and knowing the type of home loan you qualify for will help you forecast your financial situation as well. The main benefit of securing a fixed-rate mortgage in Westlake Village is that you are protected from sudden and significant increases in interest rates.

How Does a Fixed Rate Mortgage Work?

Fixed-rate loans can be made with loan terms from 8-30 years. The shorter the loan term, the faster you pay off your loan. However, a shorter loan term means a higher monthly payment. For those who want the option of the lower payment on a 30-year fixed rate loan but with a shorter term, consider adding an additional mortgage payment each year. Making one extra payment per year on a 30-year fixed-rate mortgage can cut the term down to 22-23 years. This is a highly recommended way to pay off your loan sooner. Standard fixed rate terms and how loan rates are priced are based upon 30, 25, 20, 15, and 10-year fixed rates.

For more information or to apply for an FHA Loan, contact Mack Mortgage today.