Shaida Tafreshi Prospect Mortgage
Sherman Oaks, CA
NMLS 545194
Back to the Basics: Mortgages 101
Lesson: 1
The Most Common Loan Types Available
1. Conventional
§ “Conforming Loan”- Loan Amounts Up to $417,000
§ “High Balance Conforming Loan” – Loan amounts between $417,001 - $625,500
2. FHA – Federal Housing Administration – Government Loan
§ “Conforming FHA Loan” – Loan Amounts up to $417,000
§ “High Balance FHA Loan” – Loan amounts between $417,001 - $729,750
3. Jumbo
§ Anything above $625,000 and $729,750 respectively
PROS and CONS Between Conventional and FHA Loans:
- Conventional Loans:
§ With Conventional loans you can put as little as 5% down given your loan amount is conforming. (remember, conforming is equal to or less than $417,000.)
§ With Conventional Financing, Your Mortgage Insurance premium (PMI), Is less than that of FHA on a month basis
§ No Up Front Mortgage Insurance on Conventional Loans with less than 20% Down
- FHA Loans (Government Loan)
§ Allows for less income and higher debt to income ratios
§ I can finance a loan for certain borrowers with credit scores as low as 580
§ Very LOW interest Rates on FHA loans
§ Low Down Payment of 3.5%
§ Ability to refinance via the FHA Streamline Refinance Program regardless of equity in property and no appraisal is needed.
· Even if you own a condo, the complex DOES NOT have to be FHA Approved in order for you to refinance with FHA as a part of the Streamline Refinance Programs.
Hope this helps you House Hunters and Realtors Alike!!!
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