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Mortgage Secret Part I Types Of Loans
When buying a house, most people cant pay cash, that is why there is the avenue of a mortgage. A mortgage is a loan from a bank to a buyer to purchase a home. The buyer in return signs a promissory note, promising to repay the loan. If the buyer does not make the payments, the bank (or person holding the note) can foreclose and take back possession of the house from the buyer.
Now, what types of loans are available?????
Option 1: FHA Loan - The FHA loan requires a minimum 3.5% down payment. Thus, if the sales price of the house was $200,000 then the down payment would be $7,000. (200,000 X .035 = 7,000).
Option 2: USDA Loan - The USDA loan is a loan that can only be used for rural and semi-rural properties. Go to this website to see where those properties are and if your property falls in the parameter. The minimum down payment for a USDA loan is $0.00.
Option 3: Conventional Loan - The Conventional loan requires a minimum 5% down payment. Thus, if the sales price of the house was $200,000 then the down payment would be $10,000. (200,000 X .05 = 10,000).
Option 4: VA Loan - This loan is available for active duty and retired military. There are more criteria, but contact your Realtor for more information. The minimum down payment for a VA Loan is $0.00.
Well this ends the first bit of information on Mortgage Secrets. Tune into the next blog which will look into the Cost of Getting Into a Home
Jacob Hyde, Realtor & Attorney
Team Price Inc, Broker
7320 N Mo-Pac Ste 305 Austin TX 78731
512-992-8591 (mobile) | 512-213-0213 ext 281 (office)
888-643-9502 (fax) | www.jacob.buyinginaustin.com (website)
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