Loan options have always been available for individuals looking to purchase a home. As the long-term interest rates consistently remained at all-time lows, the number of potential buyers seeking loans has increased significantly in recent years. Apart from traditional bank loans, there are other loan options available to borrowers in the US.

FHA Loans

FHA i.e., the Federal Housing Administration is a US government agency that insures and preserves certain property values for borrowers who make fixed low payments on their loans. This is the one type of loan covered under the FHA program.

FHA Loans make it easy for homebuyers to qualify; however, they do not provide any tax benefits. The upside is that homeowners pay less in monthly mortgage payments than those on a conventional loan.

If you’re looking for a good credit score and long-term loan terms, then you should look into an FHA Loan.

Conventional Loans

Conventional loans are available for every new buyer in the US. They are made by private lenders, and they can be obtained from banks, mortgage brokers, credit unions, etc.

There are two types of conventional loans available. The first is the 30-year fixed-rate loan, which has an interest rate that stays the same on all days until the loan expires. The second type is a variable rate loan on which the interest rate changes daily based on current market conditions.

Although conventional mortgages have lower monthly payments than FHA Loans, it’s more expensive to borrow money for longer periods of time. It’s common knowledge that you’ll pay more when you have interest rates that don’t change during your term of debt service.

Conforming Mortgages

These types of loans are available for homebuyers who have a credit score over 720 and a maximum loan-to-value ratio of 80%. This type of loan has a low-risk factor, which allows lenders to offer better interest rates. In addition to that, you pay the least in closing costs when you go with a conforming mortgage. Conforming mortgages require a certain percentage as down payment from borrowers. It can be lower for those who have excellent credit scores.

Non-conforming Mortgages

These types of mortgages are available for homebuyers who may not qualify for a conforming loan. Non-conforming loans usually come in the form of low-down-payment mortgages, USDA Rural Housing Loans, and FHA Loans. You can even qualify for a non-conforming mortgage if you have an outstanding debt on your property.

It's not easy to buy a home in the United States of America. At CMS Mortgage Solutions Inc., we have a dedicated team of mortgage brokers in Virginia specializing in home values, pre-approval letters, refinance analysis, and much more. We also have a mortgage payment calculator, and you can search homes for sale and home insurance quotes on our website.

You should also check out our first-time home buyer’s loan and refinance rate checker online. You have the option to choose from a range of mortgage loans - 30 years fixed mortgage, 15 years fixed mortgage, adjustable-rate mortgage, FHA mortgage loans, VA Loans, Jumbo loans, 203K loans, USDA Loans, and Reverse mortgage.