Conventional Mortgages

Conventional mortgages represent the most prevalent form of loan. Ideal for both first-time homebuyers and investors, they stand out as one of the few loan options accommodating various occupancy types. Whether you’re buying your main home, a secondary or vacation property, or a property for investment, a Conventional mortgage can be used for these purposes.

Conventional mortgages require between a 3% and 5% down payment. This is based on the purchase price of your home. 

Example: $100,000 home x 3% = $3,000 down payment

Although the minimum credit score required for a conventional mortgage is 620, these mortgages are typically more suitable for buyers possessing credit scores that are average or higher.

If you make a down payment of 20% or more, conventional mortgages exempt you from needing PMI (Private Mortgage Insurance). Additionally, if your down payment is less than 20%, PMI will be automatically removed once your loan-to-value ratio hits 78%

Conventional appraisals are some of the most common. They tend to be more forgiving than other appraisal types regarding the property’s condition.

The largest Conventional loan you can get is $750,000 for a 1-unit single family home. Some counties across the US are labeled as “High Balance” areas and will allow for a conventional mortgage of up to $1,089,300!

Get Started with a Conventional Mortgage!

FHA Mortgages

FHA mortgages are commonly chosen by First Time Home Buyers. These loans are attractive due to their very low down payments and interest rates, but they typically require Private Mortgage Insurance (PMI) for the entire duration of the loan. A notable advantage is their allowance for purchasing multi-unit properties, enabling buyers to acquire up to a 4-unit home with a minimal 3.5% down payment

FHA mortgages will allow for a down payment of as little as 3.5% of your purchase price up to 4-units!

Example: $100,000 X 3.5% = $3,500

Buyers utilizing an FHA mortgage can purchase with credit scores down to 500!

If your credit score is below 580, they do require a down payment of 10%.

FHA mortgages do require an up-front funding fee. This fee is equal to 1.75% of your loan amount. This fee can be paid up front OR rolled into your mortgage.

Example: Purchase price of $100,000

Down Payment of 3.5% ($3,500)

Loan Amount = $96,500

Funding Fee = 1.75% X $96,500 ($1,688.75)

FHA appraisals share similarities with Conventional appraisals but also have distinct differences. FHA appraisals include additional criteria regarding the home’s condition, such as:

  • Appliances that are operational and functional
  • Absence of chipped paint both inside and outside the home
  • A clean and uninterrupted water supply along with proper sanitation facilities
  • No presence of lead-based paint

These appraisals are guided by ‘The Three S’s’:

  1. Safety: Ensuring the home safeguards the health and safety of its occupants.
  2. Security: The home must secure the property’s safety.
  3. Soundness: The property should be free from any physical flaws or conditions that could impair its structural integrity.

FHA loan limits for 2023 are as follows:

Standard:

1 Unit – $472,030

2 Units – $604,400

3 Units – $730,525

4 Units – $907,900

Like Conventional loans, FHA also has certain counties across the US designated as “High Balance”. These limits are as follows:

1 Unit – $1,089,300

2 Units – $1,394,775

3 Units – $1,685,850

4 Units – $2,095,200

Get Started with an FHA Mortgage!

VA Mortgages

VA mortgages are exclusively available to U.S. Veterans and their spouses and are intended solely for primary residences. These loans stand out by offering some of the lowest interest rates compared to all other loan types, and they have the added advantage of not requiring Private Mortgage Insurance!

With a VA mortgage, you are able to finance 100% of the home’s appraised value! They do not require a down payment.

You can purchase a home using a VA mortgage with a credit score as low as 500.

While VA mortgages do not require Private Mortgage Insurance, they do often times have an up-front funding fee. This fee varies from 0.5% of your loan amount to 3.6%, depending on a few factors and how many times you have had a VA mortgage. This fee can be paid up front OR rolled into your mortgage.

While VA appraisals are much like Conventional appraisals, there are a few differences. VA has some extra condition requirements for the home. 

Some of these requirements are:

  • Working electric, heating and cooling systems
  • Adequate roofing that will last the foreseeable future
  • Sufficient in size for basic living necessities
  • Clean, continuous water supply with sanitary facilities
  • Free of lead-based paint
  • Free of wood destroying insects, fungus and dry rot
  • Safe and sanitary sewage disposal
  • Accessible from an all-weather public or private street
  • Attics and crawl spaces must be accessible and properly vented

While VA loans technically have no limit, the veteran must be able to realistically  afford the mortgage payment and have the necessary entitlement from the VA to qualify for the loan.

Get Started with a VA Mortgage!

Non-QM Mortgages

Non-QM Mortgages offer a wide-variety of lending programs. These programs are made for people that may not qualify for traditional lending. They are primarily used by investors, but there are some products designed for primary residences as well, such as bank statement loans for self employed buyers.

This loan product allows investors to use a property’s projected or average market rent to qualify, rather than their own finances. Down to 660 credit with as little as 20% down!

Bank statement loans are primarily used by self employed buyers when buying or refinancing a home. Rather than using their full tax returns to calculate income, this program allows lenders to use 12 to 24 months of bank statements to qualify.

Perfect for the homeowner that wants to tap into their equity, but does not want to lose their low 1st mortgage rate! Our HELOC options allow you to cash out up to 90% of your home’s value without effecting your current rate. Options down to 680 credit.

Get Started with a Non-QM Mortgage!

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Office:

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Disclaimer
All information is deemed reliable but not guaranteed. Neither mortgage company or website company shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. Information subject to change without notice. This is not an offer for extension of credit or a commitment to lend. 
Notice to Texas Consumers:

TEXAS RECOVERY FUND NOTICE:
Figure: 7 TAC §80.200(b): CONSUMERS WISHING TO FILE A COMPLAINT AGAINST A COMPANY OR A RESIDENTIAL MORTGAGE LOAN ORIGINATOR SHOULD COMPLETE AND SEND A COMPLAINT FORM TO THE TEXAS DEPARTMENT OF SAVINGS AND MORTGAGE LENDING, 2601 NORTH LAMAR, SUITE 201, AUSTIN, TEXAS 78705. COMPLAINT FORMS AND INSTRUCTIONS MAY BE OBTAINED FROM THE DEPARTMENT’S WEBSITE AT WWW.SML.TEXAS.GOV. A TOLL-FREE CONSUMER HOTLINE IS AVAILABLE AT 1-877-276-5550.
THE DEPARTMENT MAINTAINS A RECOVERY FUND TO MAKE PAYMENTS OF CERTAIN ACTUAL OUT OF POCKET DAMAGES SUSTAINED BY BORROWERS CAUSED BY ACTS OF LICENSED RESIDENTIAL MORTGAGE LOAN ORIGINATORS. A WRITTEN APPLICATION FOR REIMBURSEMENT FROM THE RECOVERY FUND MUST BE FILED WITH AND INVESTIGATED BY THE DEPARTMENT PRIOR TO THE PAYMENT OF A CLAIM. FOR MORE INFORMATION ABOUT THE RECOVERY FUND, PLEASE CONSULT THE DEPARTMENT’S WEBSITE AT WWW.SML.TEXAS.GOV.