So we've found your home, now it is time to buy it! For many buyers, we need to bring on a critical member of the team - your home loan lender. Getting you the best deal on your financing is critical for the most enjoyment out of your home. I’ve researched and worked with many loan officers in the greater Phoenix area - both national brands and local lenders - and I’ll help you to contact those that are the best fit for you and your financial picture. There's a loan product available for nearly every buyer out there - here are some of the most used:
Conventional – this is the loan that many people think of when it comes to buying a home. Depending on your situation, a lender may require between 5% - 20% down on the purchase in addition to your closing costs on the purchase. Most of the time, if less than 20% is put down, a Private Mortgage Insurance (PMI), may be required in addition to the principal, interest, taxes, insurance and HOA fees (if applicable), but should be removed once the Principal to Value ratio is less than 80% (i.e., you have equity of 20% or greater in the home). The maximum amount typically lent with a conventional loan is $420,000; with money down, this can be a great option if you are considering a purchase up to or even over that amount (i.e., a $450,000 home can be financed with a convetional loan if $30,000 is put down and a loan of $420,000 is issued).
FHA - loans that are insured by the Federal Housing Administration (FHA) are appropriately named after that agency, FHA loans. They typically required only 3.5% down, although some lender programs may allow less than that. These loans do not carry PMI, but do have a different cost, the Mortgage Insurance Premium (MIP), which usually lasts the life of the loan and cannot be eliminated until the loan is paid off or refinanced through another non-FHA loan product. The maximum loan amount for most counties of the country, including Maricopa county in Arizona, is $271,050. As with a conventional loan, a higher priced property can be purchased with an FHA loan so long as it is for less than the maximum loan amount lent (i.e., a $301,050 home may be purchased FHA if $30,000 is put down on the property, making the loan amount $271,050).
VA - Veteran's Administration (VA) loans are the exclusive right of those members of the armed services and their surviving spouses, provided they do not remarry. It is issued by a lender and guaranteed by the Department of Veteran's Affairs. It does not have a mortgage premium, but rather a funding fee assessed at the issuance of the loan. It requires $0 down payment and may have a maximum loan amount of $417,000. As with other loans products, VA loans may be used for higher value properties if the difference is paid down by the buyer.
Jumbo/Adjustable Rate/Other Loan Products - There are other loan products available to buyers based on your specific needs and the lender's product lines. Let's discuss what may be work best for you!
Want to get a general idea of your purchasing power? Try the Home Loan Estimate Calculator below - it is for estimates only; you'll get a better idea of the details of your potential home loan once you've spoken with one of my preferred lenders and been pre-qualified!