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Types of mortgages:
- Home equity loans are second mortgages based on the value of your house
that you own which is calculated by subtracting the total of your mortgage
from the total market value of your home. This type of loan can come either
as a loan or a line of credit.
- Reverse mortgages are second mortgages that allow you to turn the equity
of your home into income. Through a reverse mortgage you can receive a monthly
payments, a line of credit or total cash advance from your home equity. No
monthly are made on this loan until the house is sold or the owner is deceased.
- Refinancing allows you to take out a new loan to repay an older loan that
has a higher interest rate, an adjustable rate or a term (length) that is
undesirable.
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Types of mortgages:
- FHA loans are mortgages that are funded by private or commercial lenders
but insured by the Federal Housing Administration (FHA) under that Department
of Housing and Urban Development. These loans are generally utilized by low
income families, however there is no ceiling to how much income a family can
have to qualify. An FHA loan provides low interest rates and very low down
payments.
- VA loans are like FHA loans as they are also funded by commercial lenders
but insured by the federal government, in this case the Veterans Administration.
These loans have low interest rates, zero down payment, but are only eligible
for those who have served in the United States military.
- Construction loans cover the cost of the construction of a home, including
materials, labor, and land. The amount of this loan is based on an estimate
of the worth of the constructed home by an appraiser who studied the materials,
labor, land and value of similar surrounding houses.
Types of mortgages:
- A fixed rate mortgage is a loan with rate that does not change. This means
that aside from changes in insurance and taxes, whatever monthly payment you
pay the first month of your repayment will be the same as the last month of
your repayment.
- An adjustable rate mortgage fluctuates with current rates as decided by
designated indexes but begins with a low introductory rate. These rates can
change once every year, every five years or after whichever set period of
time decided by the borrower and the lender. The time between rate changes
are called adjustment periods. Adjustable rate mortgages are have more flexible
qualifying standards and are often used by those with less than perfect credit
or people who will not be staying at their home for more than seven years.
Figuring out which mortgage is best for you will make the mortgage process far less painful. Fill out our free short form and find out which mortgage is best for you.
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